Angel Investing (2): It's Personal

So I’ve established in a rather primitive post that I believe the leader/team is essentially everything.  If you’re in the world of start-ups and early stage investing I’m sure you’ve heard this from certain people over the years. I did too. But the funny thing was, hearing it only means so much. You don’t really come to understand what this truly means until you live through it and feel the pain of mistakes you’ve made personally and also through the good times when your decisions have actually worked out.

Wait, did I just coin another aphorism?:

Angel Investing is Personal.

Yes. It’s all about people and human relationships. And just like any other activity involving other human beings it can be a ton of fun and in some cases, quite frustrating.

What it comes down to is finding and backing people who have the right combination of qualities, experience, talent and character and supporting them as much as you can. (We'll get into just what I think these qualities are in future posts).

So if you are looking to get into angel investing you really need to think about this in a profound way. Talk to a bunch of experienced angels before you dive in.  Most of the time we hardly realize how little we actually know when we start participating in a new activity.

Comments

[Matt McCooe]

David,

I am looking forward to reading your post on the qualities you’ve identified in entrepreneurs. I just finished reading Michael Lewis’ Blind Side, and was intrigued with his description of Bill Walsh, the Hall of Fame coach of the SF 49ers (http://sports.espn.go.com/nfl/news/story?id=2954719). Coach Walsh was an innovator who turned every one of his QBs into winners and superstars because of his redesign of the passing game. Lewis makes the point that Coach Walsh made Joe Montana, Steve Young and others into superstars—these athletes had the God given talent, but Coach brought it out in them.

I believe many of us have the qualities and talents of entrepreneurs but are held back by circumstances, such as the times we are living in (Malcom Gladwell’s book, Outliers, does a terrific job explaining this). I also think few entrepreneurs have the benefit of a great coach, someone who sees the playing field, understands the game, and inspires.

Universities are rich in talent, with great scientists and businesspeople united by their loyalties to the school. University Spinouts are well served by having mentors and qualified coaches (checked out by someone, perhaps the tech transfer office) available to help entrepreneurs gain the connections and wisdom more experienced folks may have to offer. Engaging committed, talented coaches in the startup phase should help create more winning companies from universities.

Great blog, by the way....

[Dave Lerner]

I'm going to pick up Blind Side this weekend Matt, thanks.

Here's an Angel for you by the way: http://bit.ly/tq9Jj
He's invested in Facebook, Twitter, Google and Digg.

“I look at teams first and ideas second,” Conway says. “When an entrepreneur starts a company, the idea they have morphs radically.”