Economics of Angel Investing 💸 Angel Investing 101

Economics of Angel Investing 💸 Angel Investing 101
How to create an angel investment portfolio for maximum returns.
Learn what drives the returns for your angel investments.
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Angel Investing 101 series: ftb.bz/angel
In episode, I delve into the economics of angel investing, emphasizing the need for a significant number of investments to increase the chances of success. Research shows that most angel investments result in losses or minimal returns, but a small percentage can yield substantial profits. To improve the likelihood of hitting those winners, you should make at least 20 angel investments. Diversification across different sectors is also crucial to mitigate risks associated with market fluctuations and sector-specific downturns.
I then discuss the importance of planning an investment budget. Startups typically prefer pre-seed investments of at least $25,000 to avoid numerous small investments on their cap table. For investors with smaller check sizes, you might explore options like crowdfunding or syndicates. Syndicates involve a lead investor selecting an investment, while crowdfunding platforms allow for lower minimum investment requirements, enabling diversification through multiple smaller investments.
Lance Cottrell has been an active startup advisor and startup mentor for over a decade.
He has helped countless startups navigate the key decisions of their journey, like when to take venture capital investment and negotiating term sheets.
He works with many companies in accelerators like Y Combinator and Founder Institute.
He provides help with startup funding including raising venture capital and angel investment.
He can help you achieve liquidity for your company at a high valuation.
Feel the Boot is a startup vlog of tips and advice for early-stage founders.

[@amando96]

Ridiculously underrated channel. Subscribed ✅

[@FeeltheBoot]

Thanks!! ❤️

[@winwinsri]

Another gem of a video in your series! Why are you hesitant to use Google Ads or digital marketing? Please reconsider, as we're all disappointed to see the low view counts on these priceless videos.

[@FeeltheBoot]

Thanks for your support! In my experiments, I lost money on ads. I should probably find some other similar channels for cross-promotion.

[@GalinButler]

This is an absolutely great channel!! I hope it will grow👐🏻

[@FeeltheBoot]

Us too!

[@GalinButler]

@@FeeltheBoot I just got involved in angel investing and your channel helps me to understand the structure of this specific type of investing. Thank you! Really a gem!

[@AJiffry]

Great channel, quick question regarding the angel return stats shown at 4:00 going from 0% to 6% etc. Where is that from? Not clear to me which part of the report says that

[@FeeltheBoot]

This whitepaper has the underlying data and charts. angel.co/pdf/lp-performance.pdf?ajs_aid=de24a362-8888-4136-8019-f7d766fe8f91&_ga=2.96450268.1134267254.1714157517-1517902434.1702322116

[@jmonsch]

Your return calculation at around minute 07:30 is flawed. The annual rate of return for the example you describe is 8.78%, i.e 500,000 USD * 1.0878^10 = 1,160,006.84. This is more in line with results of the YC study you have shown earlier.

[@FeeltheBoot]

Thanks for the correction!