Not that kind of angel!
You’ve heard of angel investors and their big brothers, venture capitalists. But what does an angel investor actually do in a day?
I thought I’d break down my day today so you can see how the sausage is made:
1) Read deal memos in inbox. It could be as few as 2-4, or it could be as many as 12 or more.
Since I invest in seed stage startups, I generally look for some traction and a valuation of about $10-15 million. I like to see companies with 6 months of revenue, growing 20% or more month over month.
The traction and valuation criteria eliminate about 99% of startups right off the bat.
2) Send over a developer candidate to one of my companies. Looks like they like him!
Adding value through intros to possible employees and investors is a big part of an angel’s job. I try my darnedest to help the companies I’ve invested in.
I found this candidate via a Slack community for developers. Finding good developers who don’t already have a job is very difficult nowadays.
But I still try! One great engineer can make a huge difference to an early stage startup.
3) Answer LinkedIn messages. Usually the deal flow here isn’t great, but sometimes it can be excellent!
Don’t discount cold messages. Jason Calacanis found LeadIQ because the founder cold e-mailed him, and now the company is worth over $200 million!
4) Read about the industry as a whole. Every day, I try to learn more about technology investing as a whole, not just the companies that cross my desk.
Today I read about how founders can get investors to work for them. I also read about finding the sweet spot between valuation and traction, which will inform me as I read tomorrow’s deal memos!
5) Attend a Q&A w/ two expert angel investors tonight!
Being an angel investor is about continuous learning, first and foremost.
You learn about new companies every day and select that 1 in 100 (or more) you want to invest in. And you learn about technology and business in general, which makes you a better investor!
This constant opportunity to learn is one of the things I like best about angel investing. You see companies doing everything from 3D printing human tissue to revolutionizing e-commerce search.
There’s seldom a dull day!
What have you always wondered about angel investing? Let me know in the comments at the bottom!
Have a great day everyone!
More on tech:
This Week in the Venture Bubble
The High Growth Handbook: Scaling Startups from 10 to 10,000 People
Photo: “Earth Angel” by drburtoni is licensed under CC BY-NC-ND 2.0
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