Angels Investment Group is how to work?

Li Jing Ying

In the United States, angel investment is more like a group of investment behavior. According to the latest survey conducted by Luo Sheng, there are about 756,000 angel investors in the United States, but this does not mean that they have the same investment opportunities. Over the past 15 years, angel investors in the United States have made good investment opportunities by joining various angel groups. And if single-handedly, individuals often have very few investment opportunities.

According to Angel Capital Association, more than 330 angel groups in the United States and Canada are active in the startup community.

So, Angels Investment Group is how to work? Where is its advantage? Tanya Prive, co-founder of Rock Crowd, an equity crowdfunding platform, uses a Rock The Post crowdfunding platform co-founded by himself and others as an example. On this platform, over 500 start-ups are reviewed weekly to invest in angel-based platforms People do most due diligence and review investment projects to improve the quality of the business presented to angel investors.

In this process, companies need to go through the layers of screening. First of all, entrepreneurs need to upload business information (BP, executive summary, financial information, investor presentations, etc.), when all content is successfully uploaded before submitting an application.

Second, applications submitted by entrepreneurs will be reviewed and the platform's business analytics team will decide if it is necessary for the next step to help entrepreneurs better demonstrate their uniqueness and plan for the future.

The list of startups will be sent to a four-member voter committee. The members of the committee have over 28 years of investment experience and have invested over 2.5 billion U.S. dollars in investment and are all active angel investors People who will check the financial position, legal structure and terms of startups. If passed the due diligence of the Commission, they will give entrepreneurs time to make a conference call, ask more questions and have a more complete picture of the business.

Finally through the above link, the company name will appear in this crowdfunding platform, and registered on the platform, certified angel investors can communicate with the founder of the company, and then consider the investment. In this way, angel investors to improve the success rate of investment.

However, in Tanya Prive's opinion, joining Angel Group also has some drawbacks, such as requiring attendance at the Group's activities and keeping in touch with the Group's network. In addition, the vast majority of angel groups will be screened by members' attendance, spending an hour's angel investment each time. Another requirement is that angel investors who join the group must invest a certain amount of money each year. For example, the New York Angel Group requires that each angel investor invest a minimum of $ 50,000 per year.

In addition to this, as early-stage investments intensified, a new fund, Upside, also started a new mode of operation that involves only the seed round of investment, and all the entrepreneurs who have been invested in the fund will become the fund Partners, funds withdraw from the proceeds, these entrepreneurs can carry out the whole Fund Carry. Goldman, founding partner at Upside, believes the move allows founders to get along well with each other, a mechanism that allows Upside-invested entrepreneurs to better integrate. In the outside world, this approach can not only bind a group of outstanding entrepreneurs, but also can use the future earnings as a weight to improve the competitiveness of the fund in fighting for good projects.

The data collected by the Kauffman Foundation show that the angel angel investor's best rate of return for angel investors is 2.5 times, which is 50% lower than the forecast positive rate of return but is more competitive than the return on venture capital. A noteworthy amount of data is that only 600 of the 50,000 seed-funded companies founded by the United States last year earned venture capital. getty map