Over the past few years, I’ve had the good fortune of becoming heavily involved in the startup entrepreneurial ecosystem in Boulder and Denver.
I’ve met hundreds of founders and fellow entrepreneurs. Through the capital raise process for FullContact, I’ve met most of the VCs in the area. Through TechStars, I’ve also met a number of local angel investors.
While the startup community here is catching fire, there’s a consistent theme I hear: not enough angel capital for startups.
Colorado’s Angel Investors
Colorado has about 30,000 potential accredited investors that could easily do angel investing. But the number that actually write at least one $25K check per year? I’d bet it’s probably around 300, or 1% of the potential market.
So why aren’t more people in Colorado angel investing?
I don’t think it’s about a dearth of capital. I don’t think it’s about unwillingness to take risks.
I believe it’s about angel education.
Of course folks would like to be an early investor in the next Facebook, Zynga, Twitter, Pinterest or LinkedIn.
But to an outsider, angel investing can feel like a mysterious, dark art. (Related: see this report from Silicon Flatirons)
My Angel Investing Education
When I first started angel investing, I had no idea what I was doing. I was simply investing opportunisitically.
I didn’t know anything about deal flow.
I didn’t know anything about what terms were ‘market normal’ and which terms were way out of whack.
I didn’t know anything about ‘value-add’.
I didn’t have a strategy at all.
Like most things in my life, I just started doing.
As a result, I made some angel investments that were pretty terrible.
I even got my ex-girlfriend’s Father into a deal. We lost all our money (sorry, Jon).
I did make one awesome angel investment, however. I’ve learned a thing or two, and I feel much better about some of my recent angel investments.
Angel Investing Strategy
Want to become an Angel Investor? Go ahead and make your first few investments, and be prepared to lose $50-$100K. It’s the price of your education.
You won’t know anything about the performance of your angel investments until you’ve made at least 20 of them.
Brad and David know a little bit about angel investing. Combined, they’ve made over 250 investments(-ish) and witnessed thousands more.
I’ve had a few friends dabble in angel investing, and like me, there was no strategy. Typically, my friends made 1 or 2 angel investments, lost some money and then stopped. This is absolutely the worst possible angel investing strategy.
There is a better way.
And Brad Feld wants to help.
So, starting next year we’re setting up intimate 10 person dinners with Brad Feld at Jim Deter’s ChoLon restaurant in Downtown Denver. Jim is also the founder of Galvanize and has been an awesome addition to the Denver Startup community.
Brad Feld will provide personalized angel investing guidance.
The goal is quite simple: Educate and Activate More Angels In Denver and help build a better startup community in Denver. If you haven’t read Brad’s book on startup ecosystems, go read this post and then buy it.
The first dinner will be January 10th, 2013.
To reserve a seat at the table, simply email me: firstname.lastname@example.org and mention this post. Space is limited (only 10 seats), so act now.