Angel Investing E-Book

David S. Rose

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 437

Veröffentlichungsjahr: 2014

Beschreibung

Achieve annual returns of 25% or more with a well-designed angel portfolio

Written by David S. Rose, the founder of Gust—the global platform that powers the world of organized professional angel investing—Angel Investing is a comprehensive, entertaining guide that walks readers through every step of the way to becoming a successful angel investor. It is illustrated with stories from among the 90+ companies in which David has invested during a 25 year career as one of the world’s most active business angels and includes instructions on how to get started, how to find and evaluate opportunities, and how to pursue and structure investments to maximize your returns.

From building your reputation as a smart investor, to negotiating fair deals, adding value to your portfolio companies and helping them implement smart exit strategies, David provides both the fundamental strategies and the specific tools you need to take full advantage of this rapidly growing asset class. He details the advantages of joining an angel group, explains how seed and venture funds can help leverage an investor’s resources, and reveals how recent regulatory changes and new online platforms are making startup investing accessible to millions of Americans.

Making money is no longer about sitting back and reading stock listings, David says. It is now about being part owner of an exciting startup that can be fun and financially rewarding. Angel Investing teaches investors how to carefully select and manage investments, establish a long term view, and approach angel investing as a serious part of an alternative asset portfolio while also enjoying being an integral part of an exciting new venture.

Leseprobe

Table of Contents

Cover

Series Page

Title Page

Copyright

Dedication

Foreword

Introduction: How I Became An Angel Investor

Why Angel Investing Is About to Take Off

Part I: The Basics of Angel Investing

Chapter 1: The 25 Percent Annual Return: Why Everyone with Six Figures to Invest Should Consider Angel Investing

What Exactly Is Angel Investing?

Can You Really Make 25 Percent a Year?

Who Can Be an Angel?

…And Who

Should

Be an Angel?

Getting Started in Angel Investing

Risks in Angel Investing

Types of Angel Investors

Chapter 2: Plus, It's Really Fun!: The Nonfinancial Rewards of Being an Angel

Keeping Up with the World

Entrepreneurship without the Responsibility

The Joy of Giving Back

The Social Side of Angel Investing

Chapter 3: The Portfolio Theory of Angel Investing: Why Every Angel Needs to Invest in at Least 20 Companies

Truth 1: Most Startups Fail

Truth 2: No One Knows Which Startups Are

Not

Going to Fail

Truth 3: Investing in Startups Is a Numbers Game

Truth 4: What Ends Up, Usually Went Down First

Truth 5: All Companies Always Need More Money

Truth 6: If You Understand and Follow Truths 1 to 5, Angel Investing Can Be Very Lucrative

Chapter 4: The Financial Life of a Startup: Where Angels Fit in the Big Financing Picture

Financial Stages of a Startup

Part II: The Nuts and Bolts

Chapter 5: Develop Your Deal Flow: Sourcing and Identifying High-Potential Opportunities

Personal Connections

Angel Groups

Meetups

Business Plan Competitions

Startup Conferences and Launch Events

Accelerator Demo Days

Online Deal Sources

Deal Brokers

What to Expect When You Meet a Founder

Chapter 6: Bet the Jockey, Not the Horse: Evaluating the Entrepreneur and Picking the Right One to Back

What Makes a Great Entrepreneur?

Are Startups a Young Person's Game? How Young?

Serial Entrepreneurs versus First Timers

What About Tech Savvy?

What About Education?

Warning Signs of a Weak Founder

Chapter 7: Here Comes the Pitch: Listening to the Story Does It Make Sense for Your Portfolio?

Strength of the Management Team

Size of the Opportunity

Product or Service

Other Issues

Where Is My Money Going?

Materials You Should Expect to See During the Pitch Process

Summary Financials

Chapter 8: Look Under the Hood and Lead a Deal: Coordinating Due Diligence and Running the Show

Leading a Deal

Chapter 9: Valuations and Expectations: Discovering the Secret Economics of the Angels

The Four Simple Numbers: Basics of Investment Math

How Much Should You Invest?

What Target Rate of Return Should You Aim For?

What Is the Company Worth When You Invest?

How Do Initial Valuations Affect an Angel's Ultimate IRR?

Changing Valuations During a Round

Chapter 10: Investment Rounds and Their Forms: Common Stock, Convertible Notes, or Preferred Stock?

How Equity Investments Work

The Discounted Convertible Note

Fine Points of Investing in Discounted Convertible Notes

Chapter 11: The Art of the Angel Deal: Negotiating a Win/Win Relationship with Your Entrepreneur

Integrity and Knowledge

Relative Power Position and Personal Style

The Question of Control

Red Flags in Deal Negotiation

Chapter 12: Term Sheets and Closing: Trust Everyone…but Cut the Cards Anyway

Term Sheet for Convertible Notes

Term Sheet for Convertible Preferred Stock

Chapter 13: After the Investment: Managing Your Portfolio and Adding Value as an Active Angel

Monitoring Your Company

Thinking About Your Portfolio as a Whole

Making Follow-On Investments

Adding Value to Your Investment

Serving on a Company Board

Chapter 14: Exits and Other Unicorns: Getting Your Money Out Makes All Things Right

When a Company Fails

When a Company Is Acquired

Part III: Your Place in the World of Angels

Chapter 15: The Entrepreneurship Financing Ecosystem: Grants, Venture Capital, Accelerators, and Other Players

Government Grants

Economic Development Agencies

Business Plan Competitions

Accelerators

Funding Platforms

Intermediaries

Super Angel Investors

Angel Groups

Venture Funds

Venture Debt Lenders

Private Equity

Corporate Venture Groups

Chapter 16: Building Your Angelic Reputation: Getting the Best Deals to Come to You

Create Your Profile

Write a Blog

Answer Questions Online

Attend Events in Your Local Startup Community

Participate as a Judge, Mentor, or Panelist

Pay It Forward by Advising Startups

Chapter 17: Joining an Angel Group: Increasing Your Opportunities and Reducing Your Risks

How Angel Groups Operate

How Smart Entrepreneurs Work with Angel Groups

Angel Group Money Matters

The Future of Angel Groups

Chapter 18: Impact Investing: Doing Well While Doing Good

Chapter 19: Sit Back and Let Someone Else Do the Work: Investing in Startups through Seed Funds and Venture Funds

Chapter 20: Crowdfunding and the Global Revolution: Angel Investing for Everyone

But Wait! Here Comes Equity Crowdfunding!

What Can We Expect to See with Equity Crowdfunding?

Appendix A: Angel Screening and Valuation Worksheet

Appendix B: Angel Investment Due Diligence Checklist

Appendix C: Gust Convertible Note Term Sheet

Appendix D: Gust Series Seed Term Sheet

Appendix E: Gust Revenue-Backed Note Term Sheet

Appendix F: International Angel Investor Federations

Appendix G: Major Regional Angel Groups

Appendix H: Angel Investing Blogs and Resources

Glossary

Acknowledgments

Index

End User License Agreement

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Guide

Table of Contents

List of Illustrations

Figure 1.1

Figure 1.2

Figure 3.1

Figure 3.2

Figure 14.1

Figure 18.1

Figure 18.2

Praise for Angel Investing

“As an angel investor and a longtime fan of David S. Rose, I was delighted to hear that he finally captured his wit and wisdom in the pages of a book. David is a born teacher—clear-minded, witty, and provocative, with amazing stories to illustrate every key idea and insight. Those gifts—as well as his unsurpassed knowledge of his field—are teaching me so much more about investing than I've learned over the years doing it! Read

every

page of

Angel Investing

.”

—Barbara CorcoranReal estate mogul, Shark Tank star, angel investor

“From the secret economics of angel investing and the best methods for finding and picking tomorrow's big winners to proven techniques for adding value to any business you invest in,

Angel Investing

provides readers with everything they need to know to get started in this fascinating, fun, and lucrative business arena.”

—David Bach#1 New York Times best-selling author of The Automatic Millionaire and Start Late, Finish Rich; angel investor

“This is the most comprehensive and readable guide to angel investing ever written. The chapter on valuation and expectations lays out a clear framework for understanding one of the least-known pitfalls in the angel world. And its emphasis on creating a win-win relationship with the entrepreneur is at the heart of being a long-term successful angel—and continuing to see the best deal flow. I recommend this book to anyone even

thinking

about making or receiving angel investments.”

—Howard L. MorganFounding Partner, First Round Capital

“The world of entrepreneurial start-ups is where the most exciting and creative action is happening in today's business world, which is why I was a strong supporter of the JOBS Act of 2012. No wonder millions of people are wondering how they can get involved as investors. There's no better place to start than by reading David S. Rose's .”