Neil here. We’ve got a lot to cover today.
A couple of days ago, I talked to you about the idea of a “camel mindset” – that in today’s tough economy, companies should focus more on stretching their dollars and building a sustainable business model than on becoming the world’s next big unicorn right away.
Even in the most uncertain times, though, money still has to come from somewhere… And startups can raise this capital in a bunch of ways: from friends and family to angel investors to high-capital investments from VC firms.
I may be a little biased here, but I firmly believe that angel investors are some of the most important pieces of any startup’s toolbox.
Now, I’m not denying the value of a venture capital investment. VCs put big money into the companies where they see the most potential for healthy returns… so it’s a pretty big deal for any company to secure these types of funds.
And VCs make some big waves, too. In 2019, venture capital investments passed $130 billion for the second year in a row. Even though funding has slowed down this year, I fully expect it to kick back up once the economy levels out.
But here’s my take.
Venture capital is important, but because VCs typically don’t always invest in a company’s earliest stages, they’re not there from the beginning in the same way that angel investors are.
And since the JOBS Act became law a few years ago, more and more people are seeing the value of angel investing each year.
In fact, Crunchbase reports that over 20,000 angel and seed stage rounds took place in 2019… raising a total of around $15.7 billion dollars. This was a major record for worldwide deal volume at companies’ earliest investment stages, and I predict that it won’t be the first time this record is broken
Because it’s really not just about the money.
Sure, capital is important… but the value of an angel investment goes far beyond that.
Angel investors have the opportunity to fund a company with both capital and ideas, which can be indispensable assets for early stage companies trying to get their feet off the ground.
It’s a chance for angel investors from all backgrounds to make a real difference in a company’s growth from their most humble beginnings to their most profitable returns. And many founders recognize and appreciate those who supported their companies from the start.
That’s not to mention the extraordinary profit opportunities available for angel investors who get in on a company’s ground floor.
When business development and high capital opportunities are shared equally between big VC firms, high net-worth individuals, and everyday investors, everyone benefits.
And if you’re reading this, it means that you’re already along for the ride… which is the most exciting part to me.
We’ve built a community of people who are committed to pulling back the curtain on these types of early investments to let more than just society’s upper echelon invest in companies from the beginning.
And I’m excited to see where we go from here.
Have a great weekend, everyone, and I’ll be back soon with some more big updates.
Until next time,
14 responses to “We’re Shattering Records… And You’re Along for the Ride”
May 30 2020