Archives for May 2013

The Why and How of Updating Your Angel Investors (Guest Post)

Ty Danco and Dharmesh Shah recently published an excellent guide for entrepreneurs on communicating with investors.  They have given me their permission to share it here.

The Why and How of Updating Your Angel Investors

Good or bad news.There’s a massive amount available on the interwebs on how to improve the odds for success in new ventures. But almost nothing concrete is available on the care and feeding of your investors. You can do all of the Lean Startup experimentation you want, but we’re here to tell you that one of the the easiest and most underrated skills that a startup CEO needs is knowing how to keep your investors updated, excited and engaged.

The reason is:  The CEO is the investor’s  user interface into the business.  It’s how investors see what’s going on, and in some minimal ways, interact with the business.

We polled several early stage investors (including ourselves) that have 30+ investments each under their belts, and asked them their advice for entrepreneurs on how best to communicate with them and update them on the business. Here are the results. [Read more…]

Swimming Against the Tide (Angel Investing)

Swimming Against The Tide

So the other day I’m chatting with a new angel about a very large round that had lots of momentum – it had been expanded and was still over-subscribed. Classic case, driven by the usual factors: little bit later stage with some traction, so risk is perceived as lower, great pitch by an appealing CEO, backed by a seemingly good team, momentum in the round building quickly, a product people can understand that is already built and in the stream of commerce, and, perhaps most importantly, a perception of scarcity as the round filled up.

That scarcity factor always gets people’s juices flowing. Whether you call it the bandwagon effect or not, people get themselves into a twist about it. And I would generally agree that it can be a problem. But for a different set of reasons. It’s the flip side of the coin I see as the real problem. [Read more…]

Congratulations, Crocodoc

Crocodoc

Congratulations to Ryan Damico and the team at Crocodoc for their successful exit today to Box.com.  I invested in Crocodoc in 2009 when Ryan was a brand new entrepreneur and the company was called WebNotes. I liked Ryan and I liked the early vision. What grew out of those early roots was even more impressive. Ryan and his team went on to build a very capable enterprise class tool to display virtually any document right in the browser, via HTML5. This capability has proven absolutely essential to a variety of large customers including SAP, LinkedIn, Yammer, Facebook, and of course Dropbox and Box.com. Not entirely clear what Dropbox is going to do once this technology is in the hands of their arch-rival Box.com. That should be interesting to watch. Meanwhile, read more about the deal via WSJ here, TechCrunch here., GigaOm here, The Next Web here, VentureBeat here, and ZDNet here.

Comments, questions or reactions to this post? Leave a note below and I will respond to your questions.
If you enjoyed this post, you might enjoy: The Long Road to Instant Success (Crocodoc)
Subscribe – To get an automatic feed of all future posts subscribe to the RSS feed here, or to receive them via email enter your address in the box in the upper right or go here and enter your email address in the box in the upper right. You can also follow me on Twitter @cmirabile and on Google+.

John Huston – Angel Video Interview Series

Facetime Logo

[This post is part of an on-going series of video interviews with members of the start-up community – see a list of links to the full series here.]

John Huston is an institution in the angel investing world. He is a self-described former banker who flunked retirement and set out to find an angel group to join. Finding none, he went on to found Ohio Techangels, which has grown to become the largest angel group in North America. It has an interesting structure whereby each member contributes just $25K to a fund of 100 people and the State of Ohio matches that $2.5M with $2.5M of its own (read that and weep, residents of other states…) Members are free to invest additional dollars alongside the fund, and in fact that is where most of the capital in any given investment comes from.

In total, between the funds and the members’ side investments, the Ohio Techangels has put over $20 million into 36 Ohio-based companies. Four of the companies have exited to large publicly traded companies, yielding what the fund claimes is a 58 percent average return for investors. And as is expected with early stage investing, seven other exits were failures.

John is widely quoted and hailed as a driving force for economic development. He speaks frequently and eloquently on the topic of investors serving as directors of early-stage companies, and he is a charming rascal livening up any Angel Capital Association event. We talked in April 2013 in San Francisco. Here’s what he had to say. (Email subscribers, click here for the video).

Comments, questions or reactions to this post? Leave a note below and I will respond to your questions.

If you enjoyed this post, you might enjoy: Angel Video Interview SeriesThe Long Road to Instant SuccessThoughts on Crowdfunding,  The Crowdfunding Interview (Frank Peters Show), Pattern Matching Can Cause BlindspotsGetting Off The Ground; Early Formation EconomicsPitch Clinic at MassChallenge (Video)Why Angels Chase ElectronsBoards vs. Advisory BoardsDelusional EconomicsTen Rules For Navigating in The Age of OutrageThat Vision ThingThe Power of An Advisory BoardLoch Ness, Unicorns & The First-Mover AdvantageAre Entrepreneurs Wild Risk-Takers?Top 20 Dos & Don’ts with Angel Groups & Early Stage FinancingWhat I Look For In An EntrepreneurThe OvertureDo The Right ThingOpen Forum with Angel, Seed and VC Investors (Video)Should I Wait For A Technical Co-Founder?, and 20 Bootstrapping Ideas.
Subscribe – To get an automatic feed of all future posts subscribe to the RSS feed here, or to receive them via email enter your address in the box in the upper right or go here and enter your email address in the box in the upper right. You can also follow me on Twitter @cmirabile and on Google+.