Talk:Angel investor/Archives/2015

Notes on Editing This Entry

Before you edit this entry, please read the following notes, which discuss a number of points that mistakenly get 'corrected' and have to be reverted because they were right in the first place. Also, when adding a comment to this page, PLEASE mark the comment with your username by using the four tilde signature macro. That way everyone can keep the discussion threads clear.

♦ Links: The only links that are appropriate for this article are those to objective, not-for-profit organizations dealing with angel investing. Any commercial links to matching networks, angel groups, business brokers, for-profit web sites, or any similar sites will be removed.

Kaufman has no business being listed here either. It is not truly objective, competes with for-profit seminars and companies, and is usually about 10 years too late to make any real difference. Wikidemo 15:28, 15 August 2007 (UTC)

The previous comment is incorrect. The Ewing Marion Kauffman Foundation (note the correct spelling) is indeed both objective and independent, does not compete with for-profit seminars and companies, and, at least in the case of angel investing, is without question both ahead of the curve and of major influence in this space. Anyone with feelings to the contrary should provide references on this discussion page, with explicit relevance to Kauffman's role in the field of angel investing, before editing the article. Yorker 03:08, 16 September 2007 (UTC)

Agreed on the "links." However, even non-profits can be spam links or simply not reliable sources. Some for-profit sources like major books, newspapers, etc., could be appropriate, but not newsletters or popular nonfiction (how-to books). Finally, academic papers are often too narrow or technical to be relevant or of general interest, but can be used to back up a statement made in the article. Just my opinion, not trying to make up policy. Wikidemo 15:28, 15 August 2007 (UTC)

So, can I add a link to new social group on facebook? http://www.facebook.com/pages/Looking-for-an-Angel-a-Business-Angel/189021734529181 I have been looking for such a group on facebook, about business angels, where common people with ideas can present them to the angel investors and I couldn't find a one popular. So... I've made a one by myself. What is the idea of this group? It is a social group for people with business ideas without a necessary money. Where you might present and show for free your ideas or business startups and ask angel investors to be your partners and where you might find an idea you want to invest your money. All for free. On biggest social site of the world - facebook.com. So, can I add a link? rmh

♦ TARGET Return on Investment: The absolute, accurate fact is that "best practices" in angel investing, as explicitly taught in the courses officially sanctioned by both the Angel Capital Association and the National Association of Seed and Venture Funds, is that any given angel investment should, in theory, be capable of returning at LEAST 10x (the ACA course, as taught by Bill Payne, Entrepreneur in Residence at the Kauffman Foundation, actually suggests 30x.) The reason for this is simple if you do the math: for serious angel investors, out of ten investments it is quite typical for at least five to evaporate completely, and two or three struggle to return the original investment. That leaves two or three to 'make' the portfolio, which usually means (if the investor is lucky) two will bring in 2x-4x, and one (if you're really, really lucky), will do 10x or more. Consider that this happens over a typical holding period of 5-8 years (longer, by necessity, than the usual VC 5 year hold), and a little back-of-the envelope calculating of IRRs will show you why the target return needs to be so high.

♦ ACTUAL Return on investment: Even with a target of 20x-30x, and even in the hands of professional, the typical 'good' angel portfolio return ends up being about 20-30 percent, not 20-30 times. Understand that this is what happens in practice, and is the end result of targeting a 20x-30x return. That is, one has to aim for the moon, in order to achieve a modestly decent return.

♦ Business Angel: This term is not simply British. It is used throughout Europe, as witnessed by the Europen Business Angel Network (EBAN) which was established by the EU in 1999.

The term was originally English and it should be so noted. To suggest that an English word comes from Europe is inaccurate, although it is true that "business angel" is now commonly used there. Wikidemo 15:28, 15 August 2007 (UTC)

The introductory paragraph now simply refers to the fact that the term "business angel" is used in Europe (which includes the UK). The origin of the term 'angel' as applied to investing has been expanded further down in the article.Yorker 03:08, 16 September 2007 (UTC)

♦ Angel Groups: While angel groups or networks still account for a small minority of angel investors (substantially fewer than 10%), they are growing rapidly in numbers, size and investment capital. Angelsoft, the commercial company that provides the back-end infrastructure for most of the world's angel groups, has identified over 500 groups on six continents. For size reference, groups like Tech Coast Angels in California have over 250 members, and the more active groups, such as New York Angels in New York, regularly invest close to $10 million annually in seed stage deals, substantially more than virtually any VC firm.

All this information about angel groups should go under a different heading such as "angel groups". The vast majority of angel investors do not particpate in such groups and the current article exaggerates their importance. Wikidemo 15:28, 15 August 2007 (UTC)

Since angel groups are aggregates of angel investors this article is the appropriate place for them. The article has been edited to accurately reflect their size and relative importance. Yorker 03:08, 16 September 2007 (UTC)