Thoughts on startups by investors that
fund them & entrepreneurs that run them

Blog Archives

The UrbanTech Movement is Transforming Cities

Urbanization is a defining process of modern life.

More than half of the world’s population now lives in cities, and the number of urban citizens around the world is projected to rise to 66% by 2050.

In the US, over 80% of the population lives in urban areas with 1 in 7 Americans living in New York, Los Angeles and

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How to Give Women the Wings of an Angel

Canada has not tapped its female angel investor potential – yet.

The female angel investor conversation has been discussed inside and out. From TechCrunch, BetaKit to the Financial Post, there have been more than a few arguments made about the lack of female representation in Canada’s early-stage investment community and the benefits of tapping into this financial resource.

For example,

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What is the average startup rating on gust.com?

The rating system provided by Gust on the investor side is not intended to be used as any type of objective or standardized measurement. That’s because it was designed to be completely customizable for each angel group or venture fund using the platform.

Group administrators have the ability to turn ratings on or off, show or hide them, establish the

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What are the biggest global events for Venture Capitalists and Business Angels where they can learn about their own business?

There are surprisingly few such conferences, for the very good reason that there are actually relatively few such people (venture capitalists and ‘professional’ angel investors) to attend them! But that said, here are the biggest (i.e., “only” 🙂 events of their type):

Business Angels Angel Capital Association (US) Annual Summit This is the big one, which rotates among different cities

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What percentage of a Series A round is typically invested by the lead investor?

This is changing as the whole world of venture/angel/seed funding is rapidly morphing, but typically a ‘real’ Series A round is small enough for one traditional venture fund to do the whole thing itself. Very occasionally, they might split it with another fund, but that would probably be the exception.

What we are often seeing, however, is large-ish “seed” rounds

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Should VCs and Angels take race and gender into consideration?

Absolutely…in a positive sense [doh!], in order to help proactively ensure that (a) not only white males become entrepreneurs in the first place, and (b) that as investors they are not inadvertently restricting their universe of potential investees.

That’s why in the past few months I have gone out of my way to participate in the Black Founders Ideas Are Worthless conference (http://www.blackfoundersconferen…), the Latinos

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Convertible Debt is Bad For Angels

A couple of years ago, Paul Graham (Y Combinator) tweeted “Convertible notes have won. Every investment so far in this YC batch (and there have been a lot) has been done on a convertible note.”

The truth is convertible debt has not won.  Many sophisticated angel investors and angel groups refuse to invest in convertible debt in seed/startup deals.  Why? 

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Raising Your Hand as Due Diligence Lead for Angel Groups

Through Rob Wiltbank’s ground-breaking study in 2007, angels in groups learned that collective due diligence on new deals really pays off.  The 538 angels included in this study enjoyed 2.6X returns over the life of their investments.  However, for deals on which collective due diligence totally less than 20 hours, returns were only 1.1X.  But, deals on which angel put

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How would you break down the process of raising an angel round of investment in 5-10 steps?

1. Understand your business. It sounds obvious, but the majority of entrepreneurs who pitch me have obviously never thought through many of the major issues surrounding their companies.  You should know EVERYTHING about your business, product, customers and competition. You should know every metric regarding customer acquisition, conversion and retention. You should have a crystal clear understanding of your business

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What is the ratio of equity received for sweat equity vs. cash investment in a new venture?

There is no specific ratio between “sweat equity” and cash in a venture, and that’s actually not a good way to think about the issue. The bottom line is that cash is cash is cash, and everything else is “not cash”. The reason is that cash is fungible, which means it can be interchanged for everything else, from programming skills

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