ENT640 Evaluating Blog (Week 3. "Winning Angels the 7 fundamentals of early stage investing")
Updated: Aug 6, 2020
I am overwhelmed from the equations and mathematics toward the end of these chapters. I have had to reread some of the pages. For me personally, I better understand math by completing the mathematics myself, instead of reading them.
The Rejection Section stuck out to me the most. Handling rejection professionally is important. I feel as though I take things too personally and I can be sensitive at times. I think that it is best to keep your head up and learn from failures. Don’t be afraid to fail. What would you do if you knew that you could not fail? “I probably learned more from my failures… than from my success, or at least as much… -Mitch Kapor (132).
“Feedback from Angels who know what they are doing is like gold” (113). If we are Angels and have the opportunity to give entrepreneurs rejection, we should give structural feedback. Structural encouragement and positive reinforcement lets entrepreneurs know what they can improve for the future. Also, if we know other investors who may be interested, we can refer them.
When it comes down to it, you want to work with people that are honest and ethical. The top priority of business is to focus on the people. “The ethics of the guy are the most important.” -Howard Stevenson (122).
Important questions to ask your winning entrepreneurs potentially investing:
1. Do people in the industry know him?
2. Does he know his own weaknesses?
3. Will he listen?
4. Is this the kind of person that other people want to make succeed? (122).
Here are red flags to look for:
1. They say or do anything that is dishonest.
2. They have not identified the first customer.
3. They are not realistic about their own abilities (125).
Advice for beginners is to trust your intuition and judgment. Pursuing angel investing with a combination of passion and discipline is a good formula (133). I think that what goes around comes around. If you’re an honest and ethical person, the odds are in your favor. If you’re dishonest and basically just a crook, people will eventually find out and you’ll lose clients, or your luck will just turn negatively down the road.
Something else that stuck on to me was to practice going fast (108). The more business plans we read, the more entrepreneurs we meet, the more deals that can happen. As I read this specific book even, I have realized how much smarter I’ve become. The speed at which I read has increased its pace. I only slow down when I’m looking up words or rereading the sections so that I can understand them better. Overall I can tell I’m improving on practice. It is very humbling for me.
Amis, David, and H. H. Stevenson. Winning Angels: The Seven Fundamentals of Early-stage Investing. London: Pearson Education, 2001.