Angel Investing: Matching Startup Funds with Startup Companies -- A Guide for Entrepreneurs, Individual Investors, and Venture Capitalists by Mark Van Osnabrugge, Robert J. Robinson
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Book Reviews of Angel Investing: Matching Startup Funds with Startup Companies -- A Guide for Entrepreneurs, Individual Investors, and Venture Capitalists
Book Review: more than a Guide
Summary: 5 Stars
I am the Founder & CEO of a business that within the next 8 to 12 months was seeking to raise between $2M and $5M to fund our expansion. I always thought of going straight to Venture Capital firms or Private Equity divisons of Invmt Banks that I have already been in touch with. This book, Angel Investing, was a truly priceless read to me. The education delivered by authors has helped me re-strategize my approach to inviting external investors and also the amount that I should try to raise and the schedule of funds. What I thought was most helpful was the detailed comparisons between Angel Investors and Venture Capitalist, as well as understanding the psychology behind their thinking and how an entrepreneur seeking outside funds should try to prepare every aspect of their presentation (themselves, their product and overall business plan). The book has given me tools to have most questions covered and more importantly has prepared me to become an angel myself in the years ahead.Book Review: Great book
Summary: 4 Stars
This book starts off slowly but when it gets rolling it is very helpful ,giving good infromation where and when you need it.Book Review: Good guide for entrepreneurs who need funding
Summary: 5 Stars
If you are planning to go after Angel funding, this book is a must-read. The book contains interviews with a broad spectrum of Angels, who discuss their investment experience, the thinking they go through, and key things they look for, when evaluating an opportunity. This book would serve as an excellent reference for anyone preparing to be in front of Angels.Book Review: Good Overview of Angel Investing
Summary: 5 Stars
"Angel Investing" by Mark Van Osnabrugge and Robert J. Robinson gives useful information about angel investors and venture capitalists.Van Osnabrugge and Robinson estimate that angel investors--wealthy individuals who invest their own money into start-up companies--invest three to five times more money than venture capitalists and back thirty to forty times more ventures, making angel investors the primary source of external capital for entrepreneurs.
But, how do you meet and present your business idea to an angel investor? What factors do angel investors give the most weight to when debating whether or not to fund a venture? How do angel investors differ from venture capitalists when valuing a start-up company?
"Angel Investing" answers these questions and many more. It is stuffed with studies, interviews, and solid advice. "Angel Investing" can be divided into three main categories:
* General background about angel investors and venture capitalists and their relationship and importance to business and the economy.
* Practical advice for entrepreneurs seeking start-up funds from angel investors or venture capitalists.
* Practical advice for individuals considering becoming angel investors and making investments in small companies.
Each topic in "Angel Investing" is well documented. It's a rather formal book, actually. Robinson is a professor at the Harvard Business School and Van Osnabrugge is a former fellow of the Harvard Business School.
I found the section about successful angel investment deals a bit too rich for my taste. For example, we learn that one angel investor who backed amazon.com got a 260 times return on his initial investment of $100,000 making him $26 million. Another angel who invested in the Body Shop received 10,500 times his initial investment. As a new angel investor, don't get overly excited about the prospects! Remember, many angel investments fail dismally. As the authors point out, you must only invest money you can afford to lose!
If you are already a financially successful entrepreneur who considers becoming an angel investor, you might want to read "Angel Investing" to help improve the chances of making successful angel investments. However, the book is not a complete analysis of the due diligence process.
And, of course, from an entrepreneur's standpoint, reading a book won't automatically put you in contact with serious angel investors, and much of the real work in financing a new venture involves finding personal contacts to introduce you to appropriate angel investors. Van Osnabrugge and Robinson note that most funded ventures involve personal introductions.
Maybe, if you're ready to invest $50,000 per company or more (and ready to lose $50,000 or more per investment!), you're tired of investing in public companies (with mystic accounting and lack of reportability to the investor), and you want to add value to your investment by contributing information and contacts to your investment, this might be a good book to help get you started. On the downside, you'll probably have no diversification and poor liquidity with angel investments.
The most important tip from "Angel Investing": Do adequate research before investing in a company. And, it's best if you know the industry and know business.
Peter Hupalo, Author of "Thinking Like An Entrepreneur."
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Summary: 5 Stars
This book is one of THE BEST books on this subject matter that I have read in recent years. Having been in the venture capital industry for many years I was very interested to read what van Osnabrugge and Robinson had to say. I'll be the first to admit that I was a bit skeptical because the book was written by academics. However, after a careful read it became clear that these authors have done their homework and know what they are talking about. This book is an enjoyable read that has some of the most useful information I have found to date. I urge anyone interested in entrepreneurship and investing to read this book. You won't be sorry.