Comments on: Angel Funding Advice http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/ Entrepreneur turned VC Fri, 12 Mar 2010 22:28:18 -0600 http://wordpress.org/?v=2.8.3 hourly 1 By: staffingpower http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-2646 staffingpower Wed, 09 Dec 2009 06:54:06 +0000 http://bothsidesofthetable.com/?p=681#comment-2646 If you are searching any job please visit <a href="http://www.staffingpower.com" rel="nofollow">www.staffingpower.com</a> there are many jobs available. If you are searching any job please visit http://www.staffingpower.com there are many jobs available.

]]> By: Carlos Navarro http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-1798 Carlos Navarro Fri, 13 Nov 2009 12:00:16 +0000 http://bothsidesofthetable.com/?p=681#comment-1798 OUTSTANDING advice; I'll be launching within 60 days a subscription sitel for optometrists and have been studying different funding approaches. Are there any recommended Angel networks for healthcare-related ventures? OUTSTANDING advice; I'll be launching within 60 days a subscription sitel for optometrists and have been studying different funding approaches. Are there any recommended Angel networks for healthcare-related ventures?

]]> By: Brandon http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-1679 Brandon Fri, 06 Nov 2009 21:16:05 +0000 http://bothsidesofthetable.com/?p=681#comment-1679 Mark,<br><br>What happens in the following scenario?<br><br>Company X raises $500k from Angels based around a convertible debt structure, but then end up selling the company before a VC takes place? Likewise, if the plan is to never take VC money but rather take $500k in angel funds and exit in 18 months for $5M, is convertible debt even an option?<br><br>Brandon Mark,

What happens in the following scenario?

Company X raises $500k from Angels based around a convertible debt structure, but then end up selling the company before a VC takes place? Likewise, if the plan is to never take VC money but rather take $500k in angel funds and exit in 18 months for $5M, is convertible debt even an option?

Brandon

]]> By: ljcweb http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-1323 ljcweb Tue, 20 Oct 2009 19:22:34 +0000 http://bothsidesofthetable.com/?p=681#comment-1323 This is valuable advice. Especially this paragraph here that starts with You might feel proud that you talked angels into a $9 million pre-money, raised $1 million and therefore only gave away 10% of your company. This is valuable advice. Especially this paragraph here that starts with You might feel proud that you talked angels into a $9 million pre-money, raised $1 million and therefore only gave away 10% of your company.

]]> By: New Enterprise Forum: Term Sheets | Ann Arbor Startup Blog http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-1211 New Enterprise Forum: Term Sheets | Ann Arbor Startup Blog Fri, 16 Oct 2009 02:51:55 +0000 http://bothsidesofthetable.com/?p=681#comment-1211 [...] http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/ [...] [...] http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/ [...]

]]> By: kaiynne http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-757 kaiynne Wed, 09 Sep 2009 16:42:59 +0000 http://bothsidesofthetable.com/?p=681#comment-757 That makes sense obviously the fact that it is so early and therefore harder to value a company means the risk is much higher I suppose. So someone investing would presumably expect a much higher ROI. Thanks again. That makes sense obviously the fact that it is so early and therefore harder to value a company means the risk is much higher I suppose. So someone investing would presumably expect a much higher ROI. Thanks again.

]]> By: msuster http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-747 msuster Wed, 09 Sep 2009 12:58:37 +0000 http://bothsidesofthetable.com/?p=681#comment-747 Convertible debt: most founders prefer it because you can avoid taking money at a low price now. You build up value by building product, hiring staff, winning customers or partners and getting press. Then you raise at a higher value and the debt converts at a higher price with a discount. <br><br>For precisely these reasons the savviest angels want to price deals. Their mentality is, "why should I invest to help your company become way more valuable in the future and I end up paying a higher price for it?"<br><br>So it really is a negotiation. The one other issue to consider is that it is typically easier / less costly for the legal process if it's convertible debt. I'm told that for small rounds (e.g. $50-$150k) some people prefer convertible debt. If you're the founder and the investors accept convertible debt it's probably your best option. Convertible debt: most founders prefer it because you can avoid taking money at a low price now. You build up value by building product, hiring staff, winning customers or partners and getting press. Then you raise at a higher value and the debt converts at a higher price with a discount.

For precisely these reasons the savviest angels want to price deals. Their mentality is, “why should I invest to help your company become way more valuable in the future and I end up paying a higher price for it?”

So it really is a negotiation. The one other issue to consider is that it is typically easier / less costly for the legal process if it's convertible debt. I'm told that for small rounds (e.g. $50-$150k) some people prefer convertible debt. If you're the founder and the investors accept convertible debt it's probably your best option.

]]> By: kaiynne http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-735 kaiynne Wed, 09 Sep 2009 01:10:22 +0000 http://bothsidesofthetable.com/?p=681#comment-735 I really cannot thank you enough, as the recent founder of my first start-up your blog has been incredibly enlightening.<br><br>Could you clarify one point for me about convertible debt. I read the linked post on convertible debt and I agree that putting a valuation makes sense for early rounds but would you also recommend doing so if you are looking to raise 50-150k before an angel round? It seems like that early it is very hard to put a value on something and that deferring it through convertible debt might be safest for all parties? I really cannot thank you enough, as the recent founder of my first start-up your blog has been incredibly enlightening.

Could you clarify one point for me about convertible debt. I read the linked post on convertible debt and I agree that putting a valuation makes sense for early rounds but would you also recommend doing so if you are looking to raise 50-150k before an angel round? It seems like that early it is very hard to put a value on something and that deferring it through convertible debt might be safest for all parties?

]]> By: Advice on Angel Funding | Fort Worth Startup Blog http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-455 Advice on Angel Funding | Fort Worth Startup Blog Wed, 19 Aug 2009 20:01:28 +0000 http://bothsidesofthetable.com/?p=681#comment-455 [...] with different folks recently about funding/money issues and it reminded me of this great blog post I read from Mark Suster in which he gives a ton of useful advice about the angel investment [...] [...] with different folks recently about funding/money issues and it reminded me of this great blog post I read from Mark Suster in which he gives a ton of useful advice about the angel investment [...]

]]> By: fs2117 http://www.bothsidesofthetable.com/2009/08/14/angel-funding-advice/comment-page-1/#comment-454 fs2117 Tue, 18 Aug 2009 18:43:08 +0000 http://bothsidesofthetable.com/?p=681#comment-454 Mark - you're the man. Mark – you’re the man.

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