Angel Organization: The Gospel of entrepreneur or the spoiler of VC industry

Core tip: At present, including Sequoia China, with the creation of Albert, Fortune, Deep venture investment, and so are involved in the Angel funds.

Yang Beijing Report

At the end of 2010, David B. Lerner, director of the Ventures (Venture Lab) of Columbia University's Technology Ventures (Tech), and professor Buffalo of management, New York State University Jerry Newman (Jerry Newman) When it comes to discussing whether the US has a super Angel, the valley is already an angel investment fund.

The valley's godfather Rohn Kangwei (Ron Conway) has an SV Angel, and Anderson (Andressen Anderson Hollowitz), the Andreessen Fund of Marc Horrowitz, raised a huge 1.5 billion dollar fund; McClure start-up, a seed-fund incubator, and Aydin Senkut, an angel investment firm Felicis Ventures;twitter investor Mike Maples, led floodgate. Another Twitter investor, Chris Sacca, also set up the lowercase spur fund in late 2011, and so on.

One of the most familiar of the Chinese is probably the Y-Combinator (computer term, meaning "programs that start other programs") in the Paul Greheum (Paul Graham) business. The reason is that Kai-fu Lee (Micro-blog)-led innovation factory in the model is very similar to Y Combinator: two times a year, Y Combinator will be in a round of interviews after the selection of entrepreneurs to join their 13-week incubator class, and this is the winner will be able to get an investment, The amount is 11,000 dollars plus 3000 dollars, the number of team members, and Y Cominator get about 6% of the equity.

In this "structured" wave of angel investment, China does not seem to lag behind the US. Innovation Factory before there is Yang Ra's Taishan Angel, then Xiaoping set up a true Money fund, Lei (micro bo) set up shun for the fund, CAI won the 4399 Entrepreneurial Park. And the American Super Angel turned Angel fund manager The difference is that there are some VC/PE funds and even third-party intermediary agencies have come to plug in. In the 2010, Huaxing Capital set up an angel investment fund, the peak of huaxing, currently including Sequoia China, the same Albert, Fortune, deep venture investment and so on are involved in the Angel Fund.

"Demand-oriented?" ”

Supply and demand remains the ultimate reason.

"The total amount of money invested in the US has been at $ more than 20 billion a year," he said. Zeng Jun, vice president of the venture capital and private Equity Association in Haidian, Beijing, explains that it excludes the number of mergers and acquisitions funds and real estate investment funds. "China's data are close to this number," he said. "But structurally speaking, about 25% of the US $28.4 billion trillion in capital invested last year was early investment," while China's data are probably only about 5%.

On the one hand, the huge funding gap, on the other hand, is a continuous vigorous entrepreneurial activities. Therefore, Liu believes that Lenovo star Angel investment "in the country in the people of their own" is beneficial. But this still does not explain why Angel investment in China will be "structured" ahead of time? This is an angel of VC/PE, which seems to be easier to understand. "Early-stage" is an important exploration to avoid competition, reduce the risk caused by the fluctuation of capital market and raise the rate of investment return.

Angel funds in the United States by individual investors and then the path to fund the route seems clearer. "Most personal angels are unique in some way, but they are not versatile," he said. According to Lee's observation, Ron Conway is characterized by talent, he almost know all the people in Silicon Valley, Dave McClure is a deep understanding of the Internet, Sean Parker has a wealth of Web2.0 knowledge. The benefits of these alliances are clear: better understanding of projects, leveraging of each other's expertise, and diversification of risk.

The next step in the alliance must be to raise funds? "Private funds linked to professional institutions may really be a trend." "Lenovo Star Executive vice general manager Lu Gang said, with the cooperation of the institutional angel is often a loose union of the civil," not specifically to do angel investment, there is interest, but also has its own unique resources.

The experience of Liu Manhong, director of the World Angel Investment Association and China Angel Investment Research Center, may also be enough to illustrate the "unprofessional" private capital's yearning for angel investment, "they prefer to find good investors". In her MBA class, there is a woman doctor in Wenzhou, and many of her fellow villagers find her research experience that she hopes to learn and share angel investment. "A lot of rich people in Zhejiang and Shanxi are making angel investments," he said.

"A double-edged sword"

The American media has so judged Graham's y Combinator: it not only makes the individual survival rate higher than ever, but also changes the Silicon Valley venture capital model.

A new source of funding is now available for startups that have invested more than 20,000 to 50,000 dollars in investment, and millions of dollars in venture capital. In the past, this kind of company after using the initial funds from friends and relatives, if the next save money can only wait to die.

On the other hand, it also raises the cost of investing in good projects for Silicon Valley investors. Because more people believe in Y Combinator, their chosen and alternative companies are likely to be followed up and reported by Tech Crunch, so getting a good idea sometimes becomes a matter of every minute of the clock. The latter is the United States online, the world's largest technology blog.

This situation has its own Chinese counterpart. While increasing supply, the market is also beginning to have a "market rule of the destruction of the" argument. One VC partner made it clear: Lei's project is expensive even in the angel stage because "he's got too much capital around him and he's good at talking to people about prices."

"It's true in mobile internet. "An angel investor pointed out that valuations in this area began to have some rational returns at the end of last year. The reason for the high price, on the one hand, is that mobile internet start-ups tend to be highly perceived, and on the other hand, some of the early VC companies are also robbing mobile internet projects. "So often is not angel investment to Angel investment competition, but Angel Investment and VC cross competition." Said Angel investor.

In other areas, such as Lenovo's two other areas of concern, health care and advanced manufacturing, "the probability of encountering an institutional angel is small". It is understood that it only cooperates with the innovation workshop, or because Lenovo Holdings is also an innovative workshop investor.

Like their American peers, China's angel funds and managers have had to contend that the structure will ruin the potential challengers of Google because they will be sold before they grow. It was even bitter to think that the Super angels who were able to give their full help to the new venture were extinct.

Angel Investor Club founder, Maple Valley Investment Chairman Cengyu said: "It should be clear that angel investment is a private investment behavior, it is best not to institutional operation," otherwise it will cover the early investment of VC. She thinks only the boundary is obvious, it is advantageous to the good development of the industrial chain.

Opponents are also very simple, once the angel investment through these small funds to invest, it is justified to become a venture capitalist. This shift in status also means that the focus of work is shifted from "wholeheartedly serving the entrepreneur" to the need to take fiduciary responsibility for investors. Although David B.lerner, director of the Venture Capital Institute at Columbia University, has a different view: If a friend of an angel investor gathers together, one of them is responsible for managing the day-to-day operation of the fund without establishing a company part-time job, its essence remains the angelic community.

For China's Angel funds, perhaps there is a path to this moral dilemma. "The most important thing is whether you can live and make money." The Angel Fund Investor, a VC fund management company, points out that because of the small size of the fund, the management costs of the Angel Fund are "often very low". "But the team had horses to feed and there was a lot of investment in the early team," he said. "How is it balanced?" This is still a problem.

The bigger problem is that startups need help, whether it's hatched or wild. Angel Bay founder Pang Xiaowei points out that, in addition to funding, core team building, basic management methods, product/business model/competition, etc., all require angel investors to use their "big resources" to help these small entrepreneurs. The content of the aid, the way and VC/PE are different, "VC focus on the project is always not make stupid mistakes?" But the seed period can be ". Are the institutional angels ready?

Perhaps in the future, it is also to be seen that the angels of these institutions are gradually adjusting in place. A message to support, October 31, 2011, Innovation Factory Chairman Lee Kai-fu Li in the tech Crunch disrupt Beijing Conference, said that after two years of trial, innovation factory has begun to gradually reduce the incubator function, in turn to the direction of venture capital transformation.