Troy Knauss focuses on entrepreneurship ecosystem

Photo of Troy Knauss

Troy Knauss speaking to a group of entrepreneurs and investors in Florida.

Photo of Troy Knauss speaking in Greensboro, North Carolina

Troy Knauss concludes an Angel Resource Institute workshop in Greensboro, North Carolina to an audience of local investors and entrepreneurs.

As an accredited investor, Troy Knauss has built a diverse portfolio of angel-only backed deals with some successes, a few failures, and a whole lot of opportunities. In addition to these deals, Knauss has spent time growing companies and volunteering on boards that benefit the entrepreneurial ecosystem. His recent boards include Vice Chairman of the Angel Resource Institute, a spinout of the Kauffman Foundation, the Greensboro Partnership’s Entrepreneurship Connection, The Launch Place, and Wake Forest University’s Advisory Council for the Center of Entrepreneurship. According to Knauss, “There is no greater reward than helping a fellow entrepreneur realize his/her dream. It doesn’t matter if that dream is to simply start a company to build an income or to grow a high-value business with the ability to create major wealth creation when it is sold.” Knauss expects to continue to invest in 4-5 deals per year.

One of his latest ventures is E&I Risk, an insurance company that offers affordable and complete policies to early-stage and startup companies. According to Knauss, “Most insurance agencies don’t understand the inherent risks of a startup and, given that many startups don’t have significant revenue, many insurance agents aren’t willing to put in the time and effort for a low-priced policy. That’s where E&I Risk enters the field. E&I can provide very competitive quotes that include comprehensive coverage needed to protect entrepreneurs and their investors.” Check out E&I Risk. Click here for a quick quote on a Directors & Officers insurance (D&O) policy.

If you are interested in meeting with Troy to discuss your current business or opportunity, visit www.troyknauss.com.

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Hyde Park Angels doubles deal total, ramps up content platform

Hyde Park Angels is one of Chicago’s best-known investment groups, but recent changes to its strategy have it making more deals than ever as it enters its 10th year. 

It’s gone from a group where inexperienced investors went to try out angel investing to one where seasoned investors turn for good deals, said Maura O’Hara ⇒, executive director of the Illinois Venture Capital Association. 

The group, which grew out of the University of Chicago’s Booth School of Business in 2007, was always well-regarded, O’Hara said. But in recent years it has invested more in content and events, in organizing its roster of investors — many of whom are entrepreneurs or executives — into subject matter categories, and in recruiting investors with deeper pockets.

Those changes are attracting portfolio companies despite an increasingly competitive early stage funding market in Chicago, O’Hara said.

“If you’ve got a great business and you’re looking for a VC, you want the money but you also want the Rolodex that comes with the money,” she said, noting that many leading venture capital firms offer advisers and connections. “Now all of a sudden you’ve got Hyde Park Angels … where they’ve got 100 people with 100 Rolodexes.” 

Hyde Park Angels has invested $8.2 million in 29 deals this year, up from $4.1 million in 20 deals in 2015, said Alida Miranda-Wolff, who runs the group’s strategy and communications. She said a new focus on branding and bringing more entrepreneurs into its investor network has improved the group’s deal flow.

But Hyde Park Angels wasn’t always so good at using its investor network — which currently includes 49 founders and 83 CEOs — to market itself, she said.

In March 2015, eight months after Peter Wilkins ⇒ took over as managing director, Hyde Park Angels partnered with researchers at Northwestern University to assess its reputation. The group learned that outsiders thought it couldn’t make quick decisions, or that it was stuffy, or that it valued investors over entrepreneurs.

Miranda-Wolff, 23, wanted to change that. She joined the firm in late 2014 after graduating from the University of Chicago, where she studied English and law, with a rough job description of focusing on membership. That’s evolved into managing what she calls a platform of online and offline content and tools to connect Hyde Park Angels’ members and investors, all designed to support portfolio companies.

She announced her promotion to director of platform, the group’s first such position, on Wednesday.

The platform approach — which encompasses producing blog posts such as “Building the Perfect Pitch,” panels on topics including “How to Raise Venture Capital” and online tools to connect portfolio companies and angels — has raised Hyde Park Angels’ profile, Miranda-Wolff said.

That content has strengthened Hyde Park Angels’ brand, Miranda-Wolff said. People confuse it with another Chicago-based venture firm, Hyde Park Venture Partners, less frequently now. But operational changes have also improved Hyde Park Angels’ reputation.

Miranda-Wolff said some entrepreneurs used to think it took six months to get an answer from Hyde Park Angels. That wasn’t true; the group simply didn’t prioritize passing on deals quickly. She said they have changed that practice and now do a better job publicizing their ability to make investments within as little as 24 hours, if the deal makes sense.

“The deals we’re in now are better, easier,” Miranda-Wolff said. “It’s not that this is the first time we’re doing great deals. It’s that we have a wider and more expansive deal flow.”

Hyde Park Angels’ latest investment was also announced Wednesday: It participated in a $15 million Series B round for Chicago-founded Kenna Security. Some of its other investments were in Chicago-based appointment calendar maker Occasion and shipping logistics software maker FourKites, and Prism Analytical Technologies, of Mount Pleasant, Mich. 

Karin O’Connor ⇒, Wilkins’ predecessor at Hyde Park Angels, said the group had good deal flow under her tenure due to its connections to the Polsky Center, which gave it access to the University of Chicago’s student and alumni companies. Techstars Chicago, then Excelerate Labs, was also a source, as were young venture capital firms in the area that would look at deals together.

University of Chicago to invest $25 million in student and faculty startups

University of Chicago to invest $25 million in student and faculty startups

The University of Chicago will put $25 million of its $7.1 billion endowment into startups over the next decade, it announced Friday. It will be the first time the endowment invests directly in startups.

The announcement came as part of the Innovation Fund finals, an event at the Polsky Exchange…

The University of Chicago will put $25 million of its $7.1 billion endowment into startups over the next decade, it announced Friday. It will be the first time the endowment invests directly in startups.

The announcement came as part of the Innovation Fund finals, an event at the Polsky Exchange…

(Amina Elahi)

“It was kind of a different world,” she said. “I come from a deal background. My primary focus was always looking at the investment opportunities and working on diligence and getting to know the entrepreneurs.”

Content was not a priority at the time, she said. Working with newbie investors and entrepreneurs was.

Louis Coppey, a venture capitalist who studied the platform trend while a graduate student at MIT, said many venture capital firms already use the platform model to highlight their expertise and stand out from the competition. It is unique for an angel group to take this approach, he said, since they typically have fewer resources than larger venture capital organizations.

Prominent venture capital firms using this approach to provide more services to portfolio companies include Andreessen Horowitz and First Round Capital, both based in Silicon Valley.

Coppey said content that shows off investors’ expertise can increase deal flow because entrepreneurs want to work with people who understand their work. But he cautioned that firms should take care to balance how many resources they commit to platforms. If the market for startups decreases, that means firms will have less money.

“When you need to cut, you’re first going to cut the cost of the platform strategy” rather than the salaries of investment management staff, Coppey said.

Managing director Wilkins said the group is committed to the platform approach of creating value outside financial capital for portfolio companies and investors. He said Miranda-Wolff was instrumental in creating the “people first” brand and strategy, which has attracted high-quality deals. 

Article source: http://www.chicagotribune.com/bluesky/originals/ct-hyde-park-angels-platform-bsi-20161207-story.html

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Why It’s the Most Wonderful Time of the Year (For Angel Investors)

Beginning right before Thanksgiving and heading through New Year’s Day, I start humming the first line of the old Andy Williams song “It’s the Most Wonderful Time of the Year.”

That’s not because I am really that much of a fan of the holidays or because I love Andy Williams’ songs. I do it because this really is the most wonderful time of the year to be an angel investor.

Q4 Angel Investing Patterns to Watch

Beginning with Thanksgiving, two things happen that lead me to get my most favorable start-up investments at this time for year. First, companies slow down on their activities and start-ups that had been optimistic about closing sales before early January realize that they might not have the cash coming in that they had hoped for. Some of them recognize that need to raise more money quickly. Second, institutional investors, angel groups, and super angels tend to slow down, beginning their holiday party routines and setting off for early vacations. As a result, there are relatively few people available who will close deals.

The end result is that smaller angels like me get a lot of calls at this time. A non-trivial number of founders who didn’t want small checks or reasonable valuations earlier in the year change their minds and want to talk. Because I can read convertible note documents and wire money from a ski condo in Colorado just as well as I can from my office in Cleveland, I end up doing my best deals of the year in the final six weeks.

Over the years I have thought about this pattern and realize that it is just the simple economics of supply and demand. Venture finance markets are very inefficient. To do a deal, a founder needs to get hold of the investor and pitch. Then the investor needs to do his or her due diligence. The diligence step requires getting hold of customers and other investors. From mid-November on, there are just many fewer people available to do this.

At the same time, many inexperienced entrepreneurs have not lived through the holiday season before. They don’t think in terms of the way that investors and companies change their behavior at the end of the year. They underestimate the importance of locking down their sales and raising money before Thanksgiving if they hope to have cash coming in before mid-to-late January.

As any first year economics student can explain: when demand for something goes up and supply goes down, the price will increase. That means, in plain English, there will be better terms for the investors willing to do these deals at this time of year.

Because the data on early stage investments is so sparse I cannot show you statistics on this pattern, but make no mistake, it is there and real. While it may be poor form for me to be thankful for this shift in supply and demand, I cannot help but take advantage of it.

As for the song’s lyrics, they are just catchy and get caught in my head …

Wonderful Photo via Shutterstock


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Article source: https://smallbiztrends.com/2016/12/q4-angel-investing-patterns.html

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Dheeraj Jain: Meet India’s most prolific angel investor this year – The …

It was just one word that enticed Dheeraj Jain to come back to India in May 2014 after spending over a decade in Finland and London: startup. The country was at the peak of an entrepreneurial boom, investors of all kinds — foreign and Indian — were in a frenzied scramble to fund ventures, and it seemed the world was waiting with bated breath to welcome one more unicorn from India.

Jain, who was managing partner at London-based venture capital firm Redcliffe Capital, didn’t want to miss the bus. So he spent the first few months to understand the ecosystem, went to several startup events in Bengaluru and Chennai and kept relentlessly hunting for his maiden investment opportunity.

A few months after returning, that same word — startup — had begun to put Jain off. Unrealistic valuations, lack of concrete business plans and too much noise left him disillusioned. “It would have been stupid to invest at that time.” It wasn’t until July 2015 – 14 months after coming back — that Jain made his first investment — in CoHo, a co-living home rental startup.

Cut to November 2016. Jain has emerged as the most prolific angel investor in India with 20 deals, according to data by Xeler8, a market intelligence platform for VCs and corporates. He’s ahead of Kunal Shah, cofounder of FreeCharge (which Snapdeal acquired in April 2015), and Ratan Tata with 19 and 13 deals, respectively. Jain’s cumulative investment so far: `15 crore. ($2.2 million). With at least 20 more deals in the pipeline, an upgraded valuation of over 5X returns on his current portfolio, one exit, two partial exits, and one investment going bad, the track-record of the avid investor looks impressive.

“In all honesty, there is no science behind angel investing,” says Jain, who follows a thumb rule while making angel investing: hunting down motivated and talented entrepreneurs.

One might argue that there is an immense amount of analysis, vast domain expertise involved in making the right decision, but at the angel investment stage — which is the first investment in a startup — it isn’t so much about the company or the product as it is about the team and the confidence in its abilities, avers Jain. While the product-market fit is an obvious decision-making criteria, what tilts the investment decision invariably in all cases is the ability of the entrepreneur.

“We’re investing in the executional capability of the founder.” So what explains the eagerness to be liberal with the purse strings just two years after being repulsed by a lot of me-too startups, astronomical valuations and unrealistic marketing spends?

Tricks Trends

The startup ecosystem, Jain points out, has transformed over the past year or so. While valuations are now more sober, entrepreneurs’ expectations too have become more realistic. “The funnel of money has become leaner and investors have started focusing more on sustainable growth,” explains Jain, who worked with Nokia for over six years.

Ask him one seminal reason for the fall of the Finnish handset giant, and Jain replies like an entrepreneur: absence of risktaking appetite. “I wasn’t just arrogance that kept them rooted in Symbian, but the inability to take risks.”

So is he in sharp contrast going overboard by spreading himself too thin? After all, many believe that angel investing has become a new status symbol. “There is a lot of spray and pray — firing blindly at as wide a spread of startups as possible to find several winners,” says Amit Somani, managing partner, Prime Ventures, an early-stage investment fund based out of Bengaluru.

Though contending that the role of angels is phenomenal in providing financial, social and intellectual capital and can help early-stage startups get a better understanding of the market, Somani maintains that at the angel stage, one is largely making investments based on the quality of the entrepreneur since there is little else to go by. “The best angel investors also have conviction about the business area that the startup is in,” he says.

While conceding that the thought of his investments going bad does bothers him at times, Jain maintains there is a method behind the apparent madness. Unlike many angels who reckon the odds will favour them and at least one venture will hit pay dirt, Jain insists he has a hands-on approach, going deep into every venture he invests in. Take, for instance, CoHo. Last summer, Jain was looking to back a company that could build a mass market co-living business for students and millennials.

The business model that he wanted to invest in was clear: asset light, having control over the experience and not just a mere aggregator. So when he made his first investment in India, he nudged Uday Lakkar, one of the cofounders of CoHo, to pivot from Zocalo, a listing site for PG accomodations.

“I have never been a spray-pray guy,” he says, adding that he will continue to associate with his high-volume investment strategy. Whether it’s branded camping chain Deyor Camps, or online social learning platform Mappr, or Shipsy, a big data and artificial intelligence platform for the logistics sector, Jain stresses that a lot of thought has gone into funding such ventures. “Once I make the investment, I go deeper and get fully married to it.”

Is he happy to see Indians becoming more enterprising? Jain sounds a word of caution. Though it’s heartening to see people take a leap of faith, what’s worrying is the ‘me-too’ phenomenon and the perception of startups among aspiring entrepreneurs. While entrepreneurship became increasingly sexy, people started quitting jobs to start a venture. However, what people fail to see, points out Jain, is that for every four people starting up, at least one will be going back to the traditional job market. Jain, for his part, is here to stay. He’s currently focused on bankrolling yet another startup.

“Angels are not Superheroes

Kunal Shah , cofounder of Snapdeal owned digital payments platform FreeCharge , is India’s second most prolific angel investor with 19 deals. The decision to turn angel, contends Shah, is more of a learning experience and to help founders. So even if an investment goes wrong — early this week the Shah-backed scrap collection and recycling startup EnCashea in Bengaluru shut shop — it doesn’t matter. Edited excerpts from an interview:

Has the nature of angel investment changed?
Nothing has changed. It’s been the same for years.

Why did you turn an angel investor?
I turned an angel to learn. We didn’t have an angel investor. We used profits from my previous venture to fund the early stage.

Does angel investment provide validation of the business idea?
It helps in getting attention. Validation is only via organic customer traction.

Is early-stage investment more like spray and pray?
Angel investment, as the name suggests, is more to help founders versus hitting jackpots.

Does it bother you that your investment might go wrong, as over 90% of startups fail?
If intent is to learn, then outcome of investment is irrelevant. Media makes funding news of all types sexy and get eyeballs, but what should get coverage is the achievement of startups in terms of actual difference made in consumers’ life. This culture attracts the wrong type of investors and founders who chase fame instead of impact. Please don’t make angels appear as superheroes.

“My Big Investments have Paid off”

Anupam Mittal , founder of shaadi.com and an avid angel investor, reckons there is no sure-shot formula to succeed as an angel investor. Mittal, who is the fourth most prolific angel investor according to Xeler8 data, is ready to bet more on startups. Edited excerpts from an interview:

Has angel investing become more specialised?
Yes, it has become more specialised and the startup ecosystem is also maturing. Early-stage investing is very different from VC investing. It involves a lot of handholding and administration overheads, which VCs have realised over the last year, and which is why they are now partnering with angels.

Why did you start investing as an angel?
Return of investment, passion for entrepreneurship and monetising a historic opportunity… that’s the trigger for turning angel. What’s the formula to succeed as an angel investor? There is no one formula which is better than the other. Spray and pray is one of the strategies. People have seen success even with sector specialisation. Timing is critical and getting one or two 100X or 1,000X baggers in your portfolio determines the difference between success and failure.

The failure rate among startups is over 90%. Have any of your investments gone bad?
More than 20 have already gone bad. And another 20-30 will probably go bad. Out of nearly 100 startups, I expect only about 20 to do really well, and hopefully five will do exceedingly well. Luckily for me, my big investments have paid off really well.

Article source: http://economictimes.indiatimes.com/small-biz/money/dheeraj-jain-moving-into-early-stage-funding-of-businesses/articleshow/55516116.cms

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Man named Jordan bares moves to enhance angel investing in PHL

GENTLEMAN named Jordan recently arrived in the country not to boost Philippine basketball. It’s neither because he’s not into the sport nor because he’s Green.

Jordan Green, an internationally known and sought-after expert in the fields of early stage investing and “angel investing,” came to the Philippines to encourage local entrepreneurs to tap a group that can help them grow their business.

Green recently spoke at the Pan-Asian Angel Investing and Venture Capital Congress to promote angel investing to local entrepreneurs. The Australian expert urged Filipinos to tap angel investors to grow their businesses.

“The Asian region is an engine of growth and has large potentials,” Green said during the forum on November 25.

At present, Green is mentoring the MFT Group of Cos., an angel investing group led by CEO Maria Francesca Tan.

Green, currently the president of Melbourne Angels, is providing the skills to future investors in applying their money and skills to potential high growth businesses. He is also known to advice governments on policy and programs for the early stage investment and entrepreneurial space.

Since angel investing is relatively a new concept in the Philippines and Southeast Asia as well, Green said there is a need to promote angel investing to develop the awareness among entrepreneurs.

Generally, angel investors are entrepreneurs loaded with cash active in several businesses and communal activities. Typically working as a self-employed consultant, angel investors allocate 15 percent to 50 percent of investment portfolio to private equity investments and 5 percent to 20 percent in angel investing.

The co founder of the Australian Association of Angel Investors described angel investors as individuals who possess altruism and  are economic savvy.

Green said the steady momentum in the growth of angel investors is attributed to the rise of high-earning individuals who are utilizing their personal wealth to address the financial problems of start-ups.

The 2015 Philippine Roadmap for Digital Startups made by the Department of Science and Technology noted funding is particularly lacking in the Philippines, which forces start-ups to seek funding outside the country.

“Developing continuous support network for s start-up’s various stages can benefit the development and growth of the local ecosystem,” the report said.

Green said the country can harness the skills and resources of angel investors in their public-private partnership (PPP) projects. Since they are usually business-savvy individuals who consider risk and potential in an investment, he said the proponents of the PPP must market their projects properly to attract angel investors.

Moreover, entrepreneurs and government, as well, must put up a well-crafted business model and corporate blueprint to attract the angels, Green added.

He said angel investors and venture capital companies also consider other economic factors that may make or break a business such as the stock market, current events, current demand, risks and trend shifts.

Article source: http://www.businessmirror.com.ph/man-named-jordan-bares-moves-to-enhance-angel-investing-in-phl/

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Investing Like a Fox: An Interview With Legendary Angel Investor John Ason

What is YOUR investing philosophy? Pexels

John Ason has invested in over 80 early stage companies across a 20 year career, often as the lead angel and chalking up impressive exits such as xlibris.com, diapers.com and centrak.com. This longevity is remarkable not only considering that angel investing is a notoriously high-risk field, but also that New York City’s tech scene is much younger than Silicon Valley and itself is only a few decades old. John spoke about what mental models he brings to investing, how to make an investment decision in one minute and why we need more women entrepreneurs.

What is your investing philosophy?

The great British political philosopher, Isaiah Berlin, expanded upon a Greek poet who said “The fox knows many things, but the hedgehog knows one big thing” to distinguish between two ways of seeing the world. “Foxes” have an outlook that is divergent, even contradictory, while “hedgehogs” relate everything to a single organizing truth.

An early stage angel investor needs to think like a fox as the process of creating new markets or disrupting existing markets will necessarily conflict with one’s initial assumptions. Most other investors and VCs think like hedgehogs, they are totally data driven and cannot accept anything that deviates from their usual metrics.

At the same time, startups are likes foxes—they are searching and experimenting with many different ways to make money. My job is to help a fox-startup become a hedgehog company—be totally focused on a customer segment to generate revenue—so they can attract hedgehog money to grow to scale.

How do you assess companies?

Almost all my investments are pre-revenue and pre-customer so I find business plans and those large lengthy presentation decks a complete waste of time—they cloud rather than clarify. Instead, I ask for a single page executive summary. I see about 4,000 of these pitches annually and will typically take one minute to make a decision to either meet the founders or reject. After meeting with the founders, about half I will invest in.

What do you want to see in this one-page executive summary?

A few things:

  • In the first sentence or two they should be able to clearly express their core competency. Surprisingly, around 30% of pitches I hear fail to do this, even when prompted. Too often they list product features—that will change and is least important.
  • I want to have them describe the market opportunity and how big is it. I want their reasoning why they think so and their assumptions, not market statistics.
  • Lastly, the aesthetics of the page is important. I don’t want to see a legal brief filled every inch with words. 2/3 of the page with text is fine, lots of white space and illustrations.

What about the people element?

I want founders to be able to impress me with some previous accomplishments. It can be in a completely different field, but this shows me that they can execute like a hedgehog when needed. Related to this they have to be able to make decisions quickly. Early stage companies rarely fail because they make bad decisions, but more often because they make no decisions. Having little to no data can cause people to freeze up, so they must be able to overcome this cognitive bias.

Having a fox outlook, I also want them to challenge me and my assumptions. Sometimes I will put out a ridiculous suggestion that I know is mistaken to see if they are willing to question me and push back.

John Ason Author provided

What is a warning sign with new ventures?

When someone tells me they need 3-4 weeks before they want to meet and produce a one-page executive summary. To me that is a giveaway they are not moving quickly enough or focused enough.

We often hear about the lack of diversity in this field, what do you see?

I value diversity of thought rather than diversity in sex or race. I have invested in 14 women founded businesses – eight by foreign born and 6 by US born women. I have found the most diversity of thought in women entrepreneurs. I also mentor many women groups and angels as there is even less diversity in the angel and investor community. More female participation in both areas is the right thing to do and also good for businesses.

What is the most important thing you have learned?

Humility. In the first decade of my investing career I would focus on a big idea with mediocre people. The second decade I switched to great people with a decent idea—and my failure rate in the last decade has dramatically gone down.

People count more than ideas. I have even encouraged my companies to send their business plan to large competitors, which occasionally causes those competitors to cancel a similar project rather than compete. As it’s not the idea that scares them, but how fast the startup can move with great people.

David Dabscheck (@ddabscheck) is the CEO and co-founder of GIANT Innovation.

Article source: http://observer.com/2016/12/investing-like-a-fox-an-interview-with-legendary-angel-investor-john-ason/

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How to win at angel investing

Jordan Green (second from right) with MFT Group of Companies

In the 90s, after building my software companies in Silicon Valley, I went home to Australia and started a venture capital fund, running it for five years with a business partner. Years later, with resilient determination, the company gave birth to one of the best performing VCs in Australia.

We then eventually exited that fund, sold the portfolio, delivered eight times the return to the investors, and then I found myself looking around for a better way to really serve the emerging startup community in Australia.

With this, many aspiring investors have asked me to share my experience in the industry and personally design them angel investing (AI) and venture capital (VC) training programs.

This triggered my passion to further spread technical know-hows on AI and VC to better businesses in Australia.

It was a promising environment. There were lots of initiative, lots of good people, lots of good ideas, unfortunately, not a lot of good funding.

Most venture capital, to the extent that it existed, was waiting to invest much later in the life cycle. And again, that’s true in much of what we know in the world. So I went around the countryside, and four other guys thought it was a good idea and we started a national association—the Australian Association of Angel Investors— and then ventured on our own paths and started our own angel groups.

A little more than a decade later, the same question still presents itself: how can people win with angel investing?

Being invited by the Philippines’ MFT Group of Companies to speak at the Pan-Asian Angel Investing and Venture Capital Congress, I was given the chance to share the answers to this question with fellow angel investors.

I am thankful for working together with MFT Group in cultivating angel investing and venture capital community in the Philippines which can serve as a main driver in boosting the regional economy.

In the congress, I shared that to be successful as an angel investor, you need to understand how investments are sourced, evaluated, made and harvested. Then you need to build an investing strategy which aligns what you want to achieve with what you can offer. Then you need to construct an investing environment which enables you to execute effectively.

While it can take on different forms, angel investing, at the heart of it, is about people who are investing private money. And it is about investing their expertise so they are not passive; rather they are proactive investors who choose companies which they can actually help with more than just money—and this is a very important distinction.

Angel investors are differentiated from passive or reactive private investors by the commitment and requirement to invest both financial capital and intellectual capital.

What you invest in has to make sense; it must be something you know.

Successful angel investing is knowing what you can offer and what works for you.

Early stage business ventures need more than just money for success; they need people with the industry knowledge, experience and networks to help them reach their goals.

The proactive contribution of intellectual capital is a key element in the angel investing strategy to mitigate risk and promote success.

The value of putting up an angel organization, whatever structure you take, is it has to be something that delivers more people working on an activity, and therefore, having more time available to make it happen, making angel groups an attractive course of action.

To broaden your opportunity, join an angel group.

Green

When you get together in an angel group, I say there are three core benefits.

The first thing you get by working together in a group is you get time. Doing early stage investing is very time-consuming. You to have to find the deals, evaluate the deals, negotiate the deals, do the deals, and that is just the beginning. Then the hard work starts, putting in the time and effort to help the company succeed and exit. If you are doing it on your own, there is only so much that you can do.

But when you get together in a group, you get all those people who can take on those portfolios, so now you get a scaling of time.

Two and three, is diversification. Diversification happens in two ways: by volume and by scope. A lot of different pockets or industries are ways to ensure that you don’t trap all your risks into one space. You get diversification by volume by putting yourself into more number of deals and by getting more people, you can put a little less of your money into a larger number of deals.

Diversification by scope is putting your investment into a lot of different pockets or industries. However, we only tend to invest in what we understand.

But joining a group of angel investors with different backgrounds in a variety of industries allows you to penetrate sectors which on your own, you would not understand.

Now, the way to spread your angel investments is to go cross-border. To syndicate, you must develop relationships with other investors because in this form of investing, whether alone of between groups, or funds within a space, it’s all based on trust.

Although angel investing happens at a stage in the growth of a company where there is very little people to work with, the success of the venture is on the shoulders of those people because they are pivotal to the kind of change that comes from significant growth, or the kind of change that is required to drive significant growth.

Execution is the biggest risk of an early stage company, and execution is all people-risk. And once that money comes in, it is still people who are responsible.

Reaping the rewards of angel investing cannot be solely achieved by defining strategies or knowing your way around deals.

In an increasingly connected global community, building relationships with people is the way to develop and succeed. —CONTRIBUTED

Article source: https://business.inquirer.net/220721/win-angel-investing

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Winston-Salem Ranked as Top City to Start a Business

By Staff


winston-salem

Winston-Salem was recently nationally ranked as a “best large city to start a business.” The study was conducted by Wallethub, an online source providing tools and information consumers and small business owners need to make better financial decisions and save money.

In order to help aspiring entrepreneurs — from restaurant owners to high-tech movers and shakers — maximize their chances for long-term prosperity, WalletHub’s analysts compared the relative startup opportunities that exist in the 150 most populated U.S. cities. They did so using 16 key metrics, ranging from businesses’ five-year survival rate to office-space affordability to educational attainment of the local labor force. Winston-Salem came in 11th overall out of 150 cities, and came in 3rd for the highest average growth of number of small businesses.

One of the things that makes this small town with skyscrapers a great place for business is it is a great place to live. Winston-Salem’s cost of living is below the national average. Combine that with the amenities the city offers: a bustling downtown, parks and greenways, live theater, a symphony and opera, the Children’s Museum and SciWorks, RiverRun film festival, Black Theatre Festival, museums like SECCA and Reynolda House, an arts district and Innovation Quarter – and you have a great city with small town appeal.

Being in the right city when starting a business is important for a more reasons than just how nice it is to live there. Chief among these factors is access – to talent, investors, office/manufacturing space, and training. Winston-Salem excels in these areas.

With four colleges/universities and a nationally recognized community college within the city limits, the Camel City is regularly attracting and producing top talent in fields as wide-ranging as medicine to the arts.

Access to funding is supported by a variety of banks, including locally based BBT, providing small business loans, and entrepreneur funds such as the Piedmont Angel Network, providing investment funds.

Winston-Salem has high-quality office spaces all along the spectrum from co-working spaces to single occupancy buildings. There is also manufacturing space available in multiple locations around the city. The city boasts a great arts district with artists studios, and retail facilities downtown and throughout neighborhoods and shopping areas.

In addition to these necessities, there are multiple opportunities for training and mentorship available to entrepreneurs. Flywheel  a co-working space located in the Wake Forest Innovation Quarter, regularly offers free and low-cost events and trainings for those seeking to start or expand a business. The Small Business Center at Forsyth Tech  offers regular free ongoing business education, including assistance in creating business plans, peer mentors, and clinics. The Nussbaum Center for Entrepreneurship  in Greensboro offers a business incubator as well as SCORE mentoring programs. Winston-Salem Business Inc  provides assistance to businesses desiring to re-locate or start here. The Winston-Salem Chamber of Commerce  also provides assistance to entrepreneurs and established businesses, providing research, data, and networking opportunities as well as legislative and policy advocacy on behalf of business.

Allan Younger, Director of the Small Business Center at Forsyth Technical Community College, stresses the importance of both startup and ongoing business education. “All current and prospective small business owners should commit to on-going opportunities to enhance their skills. This is true whether they are considering starting a business, have recently started one, or have been in business for many years.”

If you are thinking of starting a business in Winston-Salem, be sure to click on the links provided above, and check into these upcoming opportunities to access some of the great supports offered to entrepreneurs:

The Small Business Center at Forsyth Tech

Seminars:

A variety of presentation-based educational opportunities. Topics include social media, marketing, starting a business, grant seeking/writing, and more. The expected outcome is the acquisition of business information.

Roundtables:

Interactive discussions about a variety of topics such as customer engagement, networking, productivity, business growth, and more. The expected outcome is the acquisition of best practices leading to increased success.

Clinics:

These experiential learning opportunities allow business opportunities to practice their skills regarding presentation, business research, sales, LinkedIn, and more. Clinics are designed for repeated participation. The expected outcome is business skill development.

In addition to our face-to-face opportunities, online training is also offered. HP LIFE (Hewlet Packard Learning Initiative for Entrepreneurs) is a free, online training program. HP LIFE is a global program that offers aspiring entrepreneurs and small business-owners valuable business skills. HP LIFE offers participants a path to realizing their business dreams. This program is self-paced, making it possible for more aspiring entrepreneurs to participate. It will help you gain the real-life business and technology skills you need to start or grow your business.

For more information, visit their website HERE to learn about various educational events. It only takes about two minutes to register for the opportunities of your choice.

An example of the events hosted by Flywheel at 525@Vine include:

Idea Tap is one part networking, one part pitch refinement, and a heap of startup support in one event! Presenters are selected in advance and have 5 minutes to pitch their startup. It can be an up-and-running company, the seeds of a someday-company, or an idea for a product—the stages of development are all over the map. With potential partners, investors and clients in the audience it’s a great opportunity to get feedback in a low pressure environment. Light snacks, drinks and great company provided!

Register to attend Idea Tap Tuesday, May 10th, from 5:30-7:30 HERE.
“How to Finance a Startup” featuring Troy Knauss, professor in the Wake Forest entrepreneurship program and one of the most successful investors in the region.

This course will provide an overview of what every founder needs to know about financing options, setting financial milestones and attracting investor capital. Learn how to get your startup investor-ready and what investors expect at seed and later stages of development. You can register for each session separately, or take the whole series at a discounted rate. More Info Registration for these classes in June HERE.

Title III Crowdfunding Crash Course:

What entrepreneurs need to know before startup financing changes forever.

Starting May 16th, small investors will be able to purchase securities from startups through registered crowdfunding portals. This means that startups will have a whole new market of potential investors to woo. However, with this new opportunity comes a slew of new rules and regulations.This is a crash course in what you need to know as a small business owner who may be interested in using this revolutionary new form of financing.

Jon Mayhugh, attorney and clinical fellow with the Wake Forest Community Law and Business Clinic, will present from 5:30 p.m. to 7 p.m. on Wednesday May 11th. This presentation is sponsored by Wake Forest University and the North Carolina Secretary of State’s Office. Light snacks and refreshments will be served. This course is free, but please RSVP if you plan on attending. Register to Attend HERE .

 

 

Article source: http://www.camelcitydispatch.com/winston-salem-ranked-as-top-city-to-start-a-business-58764/

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Avoiding The Catch-22 Of Angel Investing

Becoming a new angel investor is a Catch-22. You need experience to be a good angel investor, but you can’t gain the experience until you actually invest.

New angels can really benefit from experienced angels for insider tips to start their angel journey. One great resource is Troy Knauss, vice chair of the Angel Resource Institute. He presented an ACA webinar on what new angels need to know before their first investment.

Knauss’s first angel investment came about in the late 1980s, before there was much research to drawn on. So he did what others tend to do—go with their gut. He had the chance to invest in a wood composite decking material company and/or a plastic toy company.

Knauss decided to invest all his $100,000 into the wood composite company. Unfortunately, after many years, he ended up with a $0 return on investment. The other company, K’NEX, would have made him $10 million. Ouch.

If only he knew then what he knows now. New angels can learn from this.

“What I learned at that moment was portfolio diversification and the value of putting a little bit of money to work in a lot of deals. If I would have put $50,000 in each company, I still would have walked away with $5 million.”

All experienced angels have made mistakes along the way. Sometimes it takes a failure to learn what to do well. For new angel investors hoping to side step a few missteps, here are five key things to know before writing your first checks.

(Andrew Caballero-Reynolds/AFP/Getty Images)

Know the Risks

Getting to know your entrepreneur’s background and motivation is key to predicting whether the company will later produce a return on investment. So ask him/her a few key questions:

“Are you looking for personal income this year or greater wealth down the road?” If they are looking for wealth, they are in it to make money long-term, a good indicator of potential ROI for an angel.

“Is raising money just as important as the idea?” Another way to put this is “Are you interested in building a high growth business?”  If the answer is yes, then as an angel you know this entrepreneur has the vision to bring the idea to fruition, another good indicator of ROI for an angel.

Additional questions to assess risk:

  • Is the entrepreneur willing to give up control/ ownership of the company?
  • Will the company have significant revenues in three to seven years?
  • Is there potential for a significant return for investors? (strive for 10-20 times investment)
  • Is the entrepreneur coachable and willing to listen?
  • Is there a good exit strategy in three to seven years?

Article source: http://www.forbes.com/sites/mariannehudson/2015/07/22/avoiding-the-catch-22-of-angel-investing/

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Partnerships Give Students a “Taste of Real Life”

A framed poster hangs near an entrance of Cottrell Hall, showing an eagle spreading its wings alongside a seven-word message as familiar to students as their favorite song.

“Instilling The Entrepreneurial Spirit. It’s In Our DNA.”

Kathy Elliott, the director of HPU’s Belk Entrepreneurship Center, makes sure of that.

She brings in entrepreneurs and local business people to work with students and speak to classes and members of the school’s Entrepreneurship Club. These professionals are part of Elliott’s large network of contacts, and they unveil to students timeless lessons about leadership, networking and career growth.

Elliott has a phrase for this ongoing partnership: “a taste of real life.”

Students hear about success and failure, unfulfilled risks and fulfilled dreams. They get pointers on what angel investors look for and how an entrepreneurial future will be.

Next spring, Elliott will launch a YouTube channel that will showcase the online presentations students have produced for her classes. The presentations become a part of a student’s portfolio and a point of pride for anyone to see.

Meanwhile, in the fall and spring, students participate in two events that can earn them start-up money for their potential businesses. They go before a panel of judges to pitch their idea. If they win, they get money. But students pocket something better than cash.

Confidence.

“This real world influence helps students see and dream that anything is possible,” Elliott says. “Think about it. Enough young entrepreneurs have heard enough people say, ‘Really?’ But when, when they meet people like Troy, they hear people say, ‘Really!’”

That’s Troy Knauss, a local angel investor who has 45 companies in his portfolio. He’s an adjunct professor at Wake Forest University, and he visits at least 15 colleges and universities throughout the Southeast to talk to students about his work.

High Point University is one. He has spoken to classes, acted as a judge in contests and has helped student entrepreneurs fine-tune their ideas.

Knauss says he has been impressed with what he has seen.

He loves that HPU offers majors in sales and entrepreneurship because he believes it’ll help students navigate the ever-changing world of business. But he also loves what he finds beyond the classroom and the contests.

He discovers students who are a lot like him.

They come from families who have started and run businesses, and he knows how they were raised — sitting with family, absorbing what they hear and figuring out how ideas take root and grow.

Knauss learned that from his paternal grandfather. He called Donald Knauss Grandpop.

When he turned 18, Knauss received a gift from his grandfather. His grandfather gave him money and told him to invest in businesses to find out firsthand how deals are done, how trust is earned and how people can work together.

So, like the framed poster in Cottrell, Knauss knows the entrepreneurial spirit is part of his DNA – as well as the students he meets at HPU.

Winners of the 2015 Elevator Pitch Competition

“A lot of kids at High Point have that same ability, and like me, they sat at the dinner table and heard their parents talk about it,” says Knauss, a married father of two in his mid-40s. “But they don’t know they have it. But then, they walk into a classroom, and they remember. High Point brings it out in them.”

Gary Simon sees that.

He’s a third-generation jeweler who has run a business in High Point since 1988. In 2009, he started the Business Accelerator Fund at HPU to support a contest in which judges give students money for the best two-minute business pitches.

Simon is one of the four judges, and he likens the Elevator Pitch Competition to a kinder, gentler version of the popular ABC show, “Shark Tank.”

“There is no better soil for an entrepreneur to grow than what you find at High Point University,” says Simon.

Two weeks ago on a Monday night, inside the ballroom at Cottrell Hall, Elliott stood in the back and watched 40 student entrepreneurs she knows well receive a first from the university: a pin.

The pin, which honors their hard work and accomplishments, has a rising star on a dark-blue backdrop with three words: Ready for Success.

Kathy Elliott, director of the Belk Entrepreneurship Center

Following the ceremony, Elliott sat four rows back as yet another entrepreneur – High Point interior designer Jason Oliver Nixon – came to campus to give tips to students and talk about his professional journey.

Nixon’s talk reminds Elliott of the first-floor poster she loves02 inside Cottrell. It’s not the one with a flying eagle. It’s the other one on the first floor, one that references a phrase HPU President Dr. Nido Qubein says often.

“You cannot be a job taker,” Qubein tells students. “You have to be a job creator.”

Elliott does love that idea.

“In essence, the students I see have this sense of responsibility, this feeling of ‘This world is mine,’” Elliott says. “Students here embrace that. So, I find myself not only working with students, but I’m working with the next generation of business ideas, and it makes me feel like I’m part of the future.

“They are thinking of the next cool thing. Heck, I don’t know what the next cool thing will be, but when I watch them, I know something cool will come about. That leaves me speechless.”

Article source: http://www.highpoint.edu/blog/2015/12/partnerships-give-students-a-taste-of-real-life/

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London entrepreneur launches The New Rich List, a funding and accelerator programme


Here’s what you need to know about it

Marco Robinson, the founder of NAKED Group, has launched the world’s first entrepreneur funding and accelerator company.

Called The New Rich List, the platform aims to help start-ups “pitch their business model, get funded, receive mentoring and advice, and gain access to the New Rich List’s database of 50,000 customers”.

According to Robinson, the platform has already secured £2m in pre-seed capital.

Robinson said: “The New Rich List is the most exciting and disruptive thing I have ever done. The investor interest we have had so far has been phenomenal. Think Dragons’ Den meets the Apprentice in an offline formality, but with the unique concept of both mentoring and funding entrepreneurs. It is something I have been working on for 10 years.

“By rewarding customers generously, in a crypto-currency available for use on the newest and most exciting products and services on the market, the New Rich List will become a hub for the best, most talked about, most investable businesses of the future.”

Robinson wants to list the New Rich List on the AIM Market within two years and various other stock markets.

“The beauty of it is that instead of competing with other businesses, within the New Rich List entrepreneurs can collaborate with diverse start-ups across a variety of sectors- hugely strengthening their network,” he added.

Article source: http://www.londonlovesbusiness.com/business-news/business/london-entrepreneur-launches-the-new-rich-list-a-funding-and-accelerator-programme/12670.article

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