Angel Insights Blog

By: Elizabeth Usovicz, General Manager of Transaction Commons, as part of a series she writes for ACA aimed at entrepreneurs, "Your Pitch is Just the Beginning."

Carmine Gallo, author of “Talk Like TED”, calls ideas “the currency of the 21^st century.” It’s true that consistently refining and taking action on relevant ideas leads to business innovations and scientific breakthroughs.

For entrepreneurs with an innovative business concept, the process of refining a big idea and taking relevant action includes the ability to synthesize input from a wide range of sources. Input from too many sources can leave you feeling as though there are a hundred voices whispering in your head, muddying your refinement process and making it harder, not easier, to make decisions and take action. Making sense of this varied input requires having a framework for filtering and evaluating those voices.  Here are three framework components to consider.

By: Marianne Hudson, ACA Executive Director

The reality show “Shark Tank” has become one of the most popular programs on television and has helped the wider public hear the term “angel investor” and grasp what they do.  And likely the Sharks have invested in and coached many entrepreneurs, helping those companies become successful.

But I really liked a news article last week - “Dallas Health Startup Investors Are Angels, Not Sharks” - because it distinguished many angel investors from the maneuvering and other drama that happens on the TV show.  In my opinion, the article nailed it:

By: Marianne Hudson, ACA Executive Director

This post originally appeared on Forbes.com. 

Two industry powerhouses - America Online Co-Founder Steve Case and former Hewlett-Packard CEO Carly Fiorina - made a splash recently when they led a report, “Can Startups Save the American Dream?”

I very much like this report from the University of Virginia’s Miller Center and the ideas in it. However, they missed a significant piece of the answer. While the report focuses on how entrepreneurs can kick-start the economy, it overlooks what we need to do to support the angel investors who fuel the entrepreneurs creating our country’s jobs and innovations.

The contribution of angel investors is huge. Angels have backed some of the most important companies in America including Facebook, Google, Amazon, Twitter and Starbucks. Angels supply nearly 90 percent of outside equity to startup companies, after friends and family.  In 2013 angels invested nearly $25 billion in about 71,000 companies in every state. Without angel investors, many of these companies would not be around.

By: Christopher Mirabile, ACA Board and Launchpad Venture Group

This post originally appeared on Inc.com

Most people are pretty confused about what crowdfunding is and is not. Here are the ten key concepts entrepreneurs and investors need to understand.

1. Product crowdfunding and equity crowdfunding are really different.

Most people still confuse them. Product crowdfunding is done on sites like Kickstarterand Indiegogo. It allows you to finance innovation directly, at the product level; contributors pre-purchase products or simply donate. Conversely, with equity crowdfunding investors take stock ownership in the company making the product, which is very different and quite a bit more complicated. Equity crowdfunding is not yet fully democratized for ordinary investors, but sites like AngelList and WeFunder allow larger (accredited) investors to do it.

By: Elizabeth Usovicz, General Manager of Transaction Commons, as part of a series she writes for ACA aimed at entrepreneurs, "Your Pitch is Just the Beginning."

Asked to explain his investment philosophy to a group of entrepreneurs, the founding partner of an investment fund put it this way: “There are only two things I care about: Can you make product, and can you sell product?”  If you’re the founder of a startup, you know first-hand that sales drive revenue, and revenue drives both investment and growth. How good are your sales skills?

All sales are the result of creating a connection with the buyer, and the best salespeople are adept at developing meaningful business relationships with their prospects. Here are some essentials to developing relationships like a sales pro.

As we say goodbye to 2014 and jump in to 2015, we would like to add our congratulations to all ACA members with recent growth, investments, and exit news!   Here are a few recent stories below:

Big Returns!

• Congratulations to Tech Coast Angels and Pasadena Angels on announcing that their recent exit of long term investment Bluebeam represents a 20x return.
• Hivers and Strivers members start 2015 with a great exit in Cargometrics and kept their average of time from investment to exit at 18 months.
• Pipeline Fellowship’s first investment is also their first exit!  Way to go Philantech.

By: Christopher Mirabile, ACA Board and Launchpad Venture Group

This post originally appeared on ScratchPaper.

By: Marianne Hudson, ACA Executive Director

ACA is aimed at providing the best information and resources for our member angels and the startup community. As we begin what we hope is a fantastic year for investors and entrepreneurs alike, we share 32 of the best articles, blogs and books in our field from 2014 to help you build your own libraries.

By: Marianne Hudson, ACA Executive Director

This post originally appeared on Forbes.com.  To learn more, please join us for a webinar on this topic on January 14.

We're all aware of the amazing research and technologies that universities are doing to improve people's lives. What makes many angels excited is that these new innovations can lead to great companies - if universities can connect with the right startup entrepreneurs.  

What is often surprising to learn is how difficult it is for angels and universities to work together to bring these technologies to market. While Google, started by Stanford graduate students Sergey Brin and Larry Page, is forever connected to the university through licensing agreements, many successful companies such as Facebook, Microsoft and Dell weren't. Although they were conceived of by college students, they were started after the founders left school.

What causes these gaps? Jamie Rhodes, a former university tech transfer head, serial entrepreneur and founder of Alliance of Texas Angel Networks plus an Angel Capital Association (ACA) board member, notes that other than Stanford and MIT, few universities have figured out how to transfer their technology into successful startups. One reason for Stanford and MIT's success is that their professors understand the importance of having relationships with entrepreneurs and investors. Their technology transfer offices understand that a successful partnership means more than a big corporate licensing agreement. So how can angels and universities tighten their partnerships to close these gaps?

By: Marianne Hudson, ACA Executive Director

Last week, President Obama signed the Tax Increase Prevention Act, which includes several benefits for small businesses and also a benefit for angel investors. We want to get this information out to you, as this benefit relates to investments made in 2014 (retroactively and through December 31).

The new law includes a 100 percent exemption for gains made in Qualified Small Business Stock (also known as “Section 1202”) and this new law effectively means that you pay no taxes on gains from your investments that meet several criteria below and Alternative Minimum Tax does not apply. If you are interested in this program, PLEASE TALK TO YOUR ACCOUNTANT to ensure you have all the information you need to structure your investments to meet all requirements.