Business Angels: Investment in startups
Many current and future investors are looking for a magic recipe for successful investments. There is no such thing. However, there are a few rules worth following.
Recently, I had the unique opportunity to be part of the TOP40 Jury at the Latitude59 conference, organized by EstBAN (Estonian Business Angel Network). This experience not only stood out as unique but also provided me with many valuable lessons. The end result of this process will be CFG.BA’s investment in the winning startup, which will receive EUR 1 million from a syndicate of business angels under the aegis of EstBAN and TeraVC.
Here are a few conclusions for future and current investors, drawn from my experience so far:
1. Using tools: If you are a business angel or planning to invest in startups, consider using tools such as Dealum, Crunchbase, or Funderbeam. These platforms significantly facilitate work, analysis, and even the investment process itself.
2. Membership in Business Angel Networks: Consider joining associations or business angel networks such as Sterling Angels, Cobin Angels, or EstBAN. Membership in such organizations provides access to knowledge, contacts, and interesting projects to invest in. The possibility of joint investing in syndicates or exchanging ideas with other investors are just some of the benefits.
3. Study and Time: Give yourself time to learn and understand the topic of angel investing, especially if you are just starting out. At least one year will allow you to better understand the investment process and make more informed decisions.
4. Investment Lawyer Support: Do not invest without the support of an experienced investment lawyer. Although expensive, it provides peace of mind. This is particularly recommended for people who like to think strategically and long-term.
5. Investment Risk: Remember that investing in startups is one of the riskiest forms of investment. Mentally prepare for the possibility of losing your invested funds. Invest only an amount whose loss will not negatively affect your financial situation.
These conclusions are the result of my experience and observations of the world of investing in startups. Let them guide you in making informed investment decisions!
And if you want to talk about these and other financial topics, schedule a free call. All details about my availability can be found here. Let’s meet for coffee!
