Angels Finding Strength in Numbers


strength 150x150 Angels Finding Strength in NumbersOnce upon a time, the typical angel investment involved one or two individuals putting money into an enterprise started by a friend or family member. That type of investment is still widespread, and still vital to economic development. But one of the most important investment trends in recent years is the growth of groups or networks of angel investors who come together to share risks, knowledge, and rewards. If you want to be an angel investor, you don’t have to go it alone.

There are several reasons why angel investing is becoming more of a group activity. Perhaps the most important is that angels are taking on larger and larger projects. Established venture capital firms have become increasingly cautious in making investment decisions — especially when it comes to initial funding — and angels are stepping in to fill the void.

Larger projects obviously have larger capital requirements, but that’s not the only reason why angels are coming together to pool their resources. Larger projects also require more business experience and expertise. Groups of angel investors typically include members with a variety of business backgrounds. Besides providing funds for startups, they can offer the kind of coaching and mentoring that many budding entrepreneurs need. Angels can strengthen the management team, introduce best practices, and help create strategic plans.

The members of an angel investment group learn from each other as well. The typical group includes both novices and veterans. You don’t have to an expert to join.

Angel groups often come together around a common theme. For example, a group might specialize in clean energy or retail or hospitality. The members of the group feel more comfortable putting money into a venture because they understand the business they’re investing in.

Angel investing groups are springing up in key financial centers throughout Asia. According to Singapore Investment Network, 3.5% of adults in Singapore have made angel investments, and a growing number of these investors belong to groups.

Whether or not you belong to an investment group, Venture Hype offers a great opportunity to expand your investing horizons and get in touch with like-minded people — people who love the promise and the possibilities of angel investing.

* For series, references are published in the last installment of the series.

 

  • tongyun

    As the saying goes, “there is strength in numbers” and that is probably the main benefit or working as part of a group of angel investors. However, groups are not always good. When run poorly, they can stifle and smother members of the group and end up sabotaging their progress. However, when a group is well run, amazing and wonderful things often happen.

  • Sanjay Uplana

    I am agree with the concept. A single and risky investment is no match to the exciting scenerio available in the group investment concept. A group can perform the market research in a fast and effecient way which is necessary prior to any investment. Also in the condition of any loss, you are not alone and a financial help is always available.

  • http://venturehype.com/ The Hyper Team @ Venture Hype

    Angel groups are either member-led or professionally managed by non-affiliated managers. We'll compare and contrast the two in an upcoming post so you can learn more about their respective pros and cons.

  • cirereyes

    I think a group of investors would be better because there will be a lot of sources of funds for a project. And I believe a business that was started by a group of angel investors will be more stable because there will be a lot of ideas that can be gathered and shared to achieve the goal of the organization.

  • Cogbuddy

    I prefer the group because if we do any mistake, there will be another one to correct us. Similarly we can share the successful tips with others. It is easy to copy the successful formula rather than to try it ourself and succeed. It will take some time. But we must see that there is no person in the group trying to dominate others.

  • Kejatz

    I think in this day when all investment carry some risk with them, investing alone is not an option. It is much wiser to share risk, share the possibility of mistake and the mistakes themselves with other investors. But most important thing of not being alone is gathering important experiences of a group and improving the odds for successful investment.

  • http://vladadrugstore.blogspot.com/ vlada

    Well, it's very old and very good principle that the strength increases with numbers. And I'm sure that it is an absolutely right decision that Angel investing groups are springing up in key financial centers throughout Asia. I think that the investments into the Asia will be the most profitable in the nearest future.

  • Venture Hype | From Chaos to Order: How to Manage Your Angel Group

    [...] Angels Finding Strength in Numbers [...]

  • http://venturehype.com The Hyper Team @ Venture Hype

    Thanks for everyone's comment. Quite a consensus. Aaron discusses the differences between member-led and professionally-managed groups in his recent post, From Chaos to Order: How to Manage Your Angel Group. Take a look if you're interested in organizing an angel group in the future.

  • sybil

    I guess i fall on this category, an angel investor and i quote “You don’t have to an expert to join.” I am a novice in here and still in a shady part, that need enlightenment and support from you guys.

  • http://happyfic.blogspot.com/ Orrymain

    I'm very much intrigued by the entire concept of angel investing. I really hadn't been aware that it took on so many different angles, such as the syndicate as mentioned in another article and in fact, venture companies. I always thought of it as a solo adventure, so to speak. I continue to learn from my time here, not just with the articles themselves, but the comments.

  • http://venturehype.com The Hyper Team @ Venture Hype

    That's the exact reason why we're here! To seek out useful information and share with all, with the hopes of turning “thinking” angels into “acting” angels. Do let us know if you have any questions!

  • http://venturehype.com The Hyper Team @ Venture Hype

    Thank you for visiting often. The articles provide points of discussions but it's through the comment area that we get to interact and learn from each other.

    In fact, angel investing can be a team or solo sport. For new investors, it's best to co-invest, to both spread the risks as they learn the ropes. Although some seasoned investors prefer to invest solo, they might co-invest if the financing round exceeds their usual investment limits.

  • http://venturehype.com The Hyper Team @ Venture Hype

    That's the exact reason why we're here! To seek out useful information and share with all, with the hopes of turning “thinking” angels into “acting” angels. Do let us know if you have any questions!

  • http://venturehype.com The Hyper Team @ Venture Hype

    Thank you for visiting often. The articles provide points of discussions but it's through the comment area that we get to interact and learn from each other.

    In fact, angel investing can be a team or solo sport. For new investors, it's best to co-invest, to both spread the risks as they learn the ropes. Although some seasoned investors prefer to invest solo, they might co-invest if the financing round exceeds their usual investment range.

  • http://venturehype.com/indian-angel-network-world-business-angels-association/ Head of Indian Angel Network Padmaja Ruparel Part I: World Business Angels Association | Venture Hype

    [...] of individual investors who source deals as a single entity – has joined force with similar angel groups to form an international association for angel networks throughout the world. Dubbed the World [...]

  • Angel Venture Fair Streamlines Investing Process to Generate Quality | Venture Hype

    [...] Investors Forum is a consortium of angel investors and angel groups in the Mid-Atlantic Region which organizes The Angel Venture Fair, an annual early-stage investment [...]

  • http://venturehype.com/what-is-a-syndicated-investor/ What Is a Syndicated Investor? | Venture Hype

    [...] not uncommon for a group of angel investors to form a syndicate, or for a single angel to join a syndicate, with the purpose of loaning a [...]

  • http://venturehype.com/unconference-2009-for-todays-and-tomorrows-opportunities/ e27, unConference 2009 Singapore | Venture Hype

    [...] can also join organized angel groups that weed out the bad from the good. Or invest alongside seasoned angels. The lead investors will [...]

  • http://venturehype.com/paul-silva-of-angel-catalyst-angel-groups-are-like-herds-of-cats/ Paul Silva of Angel Catalyst: “Angel groups are like herds of cats.” | Venture Hype

    [...] company that takes the grunt work out of angel investing. It builds and runs professional angel investor networks and frees investors from tedious adminitrivia so they can focus on sourcing, evaluating, and [...]

  • http://venturehype.com/how-to-become-an-angel-group-manager/ How to Become an Angel Group Manager | Venture Hype

    [...] We ran out of money and went into a bootstrap, no-salary mode. My former mentor had just founded an angel group and needed help. He made me his partner in the angel group after a [...]

  • http://venturehype.com/do-good-take-a-look-at-technology-parks-startups/ Do Good – Take a Look at Technology Parks Startups | Venture Hype

    [...] companies through this type of program. For example, University of Maryland administers a regional angel investor network called CAN (Capital Access [...]

  • http://venturehype.com/ready-to-become-an-angel-investor/ What It Takes to Become an Angel Investor | Venture Hype

    [...] widely diversify their investments in hopes of increasing their chance of a strong return. Such groups also allow for a pooling of knowledge and experience to make more informed decisions on [...]

C Corps vs. S Corps vs. LLCs: Which Corporate Structure Should Angels Invest In?

C Corps vs. S Corps vs. LLCs: Which Corporate Structure Should Angels Invest In?

Read Description »

 

Sign Up for Email Updates

Don't miss any articles! Enter your email below to receive them via email. Sign up now.

Venture Hype respects your privacy. We'll never sell or share your email, and you may unsubscribe anytime.

Connect

venrurehype-twitter venrurehype-facebook venrurehype-subscribe email venrurehype-friendfeed venrurehype-rss

What People Are Saying

Quote
I have found the Venture Hype team one of the most professional teams I have dealt with. Well oiled process, good questions, excellent editing and marketing etc.
Quote

Bruno Bensaid
Accredited Investor, Angelvest
Mentor, 500 Startups
Partner, Shanghaivest

Special Thanks

Like Our Page

Recent Articles

Sponsored By

Venturehype related post