Tim’s Blinklist: Angel- How to Invest in Tech Startups by Jason Calacanis

For the uninitiated

Bootstraping your angel journey

• Join a syndicate
• Be a broke angel, be an advisor

Your syndicate journey

• Contribute a ton lot
• Write deal memos

Building your angel network

• invest with known and experienced angels via syndicate
• build a spreadsheet of their contacts with their Linkedin, AngelList, Twitter, email details. Collect social currency by occasionally retweeting/liking/commenting on their posts.
• execute by emailing them when ready. example email template:

Hey Jason, we co-invested in Company Y together. Do you have time for a quick coffee next week? I plan to invest at least $2.5k each into 2 startups per month going forward and would love to trade notes. All the best, Tim

Goals of coffee chat

• Figure out what they invest in and why
• Figure out what value they bring to startups
• Offer them your own connections, and let them know what value you bring. Provide value to everyone in the eco-system with your social currency, it pays back tenfold

Preparation for a pitch meeting

• review/try their product
• understand the market and competitors
• knowing who else already invested in them/competitors

Your best next question is typically hidden in the subject’s answer to your last question. Great interviews are like conversations that involve ideas being volleyed back and forth.

Filtering your flow

• It is hard to pick the right start up, so try to go by elimination and filter out weak ideas and founders
• On first contact (email), collect important filter data such as how many fulltime employees, funding history, how much money made, how they acquire customers and why they are building this business
• find business that can scale
• be an exceptional judge of talent, you cant predict the future and tell which ideas are going to succeed

Questions to ask on f2f meetings

(while showing empathy, talk less listen more) Ask to find out — how committed is the founder, what are his chances, what does winning look like in terms of revenue and return

• What are you working on?
• Why are you dong this?
• Why now?
• Whats your unfair advantage

Tactical questions to ask

• tell me about the competition
• how do you make money
• how much do you charge customers
• how much does your average customer spend
• tell me top 3 reasons why your start up may fail

Finding your groove (alpha)

Some angels bet on founders

• Steve Jobs or Elizabeth Holmes

Some angels bet on problems(solution)

• Is your startup a vitamin or painkiller?
• graph of intensity of pains vs frequency of people experiencing the pain

Some angels bet on delight

• Case in point: Apple products that are aesthetically delightful, thus commanding a price premium even though specs may be inferior

Some angels bet on markets

• Trending markets
• TAM, SAM, SOM