As a new independent angel investor, how will I find new companies to invest in?
The two sites you mentioned are both secondary listing services, for later stage companies. For a new angel investor, by far the best thing to do is to join a local angel investor group that belongs to the Angel Capital Association. There are hundreds of them, with at least one in every state. Major metropolitan areas typically have more than one.
Some groups specialize, investing primarily in life sciences or tech companies or women-led ventures or other areas. Some are wide open, investing in everything from real estate to films. Most are somewhere in between, focusing primarily on early-stage, high-growth companies with scalable business models. These are typically Internet-enabled, or consumer products, or medical devices.
But regardless of the specifics, what they all have in common is bringing together a group of active Accredited Investors interested in supporting young startups. Benefits of joining a group include pooling deal flow, capital, domain expertise, and investing experience. Most groups run regular education sessions for new members, and provide mentoring for less experienced investors by those with many deals under their belt.
The typical US angel group will receive a dozen or more funding applications from startups each month; the most active ones, such as New York Angels will receive over 100. Groups also often “syndicate” investments, working cooperatively to fund larger rounds that are bigger than one group can easily handle alone.
As a very rough idea of what these groups are like, the typical member invests in one or two companies each year, putting in $25,000 to $100,000 in each one.
To find one or more local angel groups near you, use the industry’s official investment group search engine at http://gust.com/find-investors.
And for a more in-depth view of angel investing, check out Angel Investors: If I want to invest $5,000 as a new angel investor, what chances do I have of making a profit in 5 years?.
*original post can be found on Quora @ http://www.quora.com/David-S-Rose/answers *(No tags for this post.)
Written by David S. Rose
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First, it’s important to understand that the four platforms you list fall into two very distinct groups.
Kickstarter and IndieGoGo are project-based crowdfunding platforms through which anyone can contribute money, either as a donation or with the promise that they will receive a tangible ‘reward’ of some kind if the project is successful.
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