One of the common questions I get from other angel investors and VCs is regarding my personal angel investing strategy. Most investors have a strategy about the types of deals they like to do, and then when a deal fits the strategy, they go through their investment criteria (see Ask Investors About Their Investment Criteria).
Here’s my angel investing strategy:
- Look for entrepreneurs that have failed at a previous venture and started again (shows they’re serious about being an entrepreneur and aren’t a hobbyist)
- Find small, fast growing markets that have the opportunity to be much larger
- Demonstrate modest traction with at least 10 arms-length customers (once an entrepreneur has 10 customers, I can help on the journey to 100 customers)
- Prove basic unit economics (strong gross margin potential) and primarily recurring revenue
My angel investing strategy has evolved over the past few years and continues to do so. This strategy focuses on serious seed stage entrepreneurs with early, modest results and a recurring revenue business model.
What else? What are some more personal angel investing strategies?
One thought on “Personal Angel Investing Strategy”
What about experienced ‘Treps that persisted and worked 24/7 w/o stopping or pausing for 22 years to get the right traction? How about a fast, small agile team that is re-vamping a $17B, media market with which they have prior success with a national company that IPO’s and then dominated the market for 23 years before losing relevance and selling it all off. And now they have their own amazing, bullet-proof technology, 10 national clients and the largest, independent strategic partners in place representing the world’s largest advertisers…and it’s just getting started on new products and growth strategy. Would that peak your interest in “A” shares? If not you, do you know any large investors who know about broadcast media and like long-term recurring revenues?