To Paul G: What's the ETA on the model convertible note you said http://news.ycombinator.com/item?id=1655585 you guys were releasing soon?
The New Funding Landscape
11–20 of 57 posts
Re: The New Funding Landscape
#12Ok. Negative points for my last comment justified.
Here is my dilemma:
Our company has created an online application we call "Supertrainer."
The reason we named it "Supertrainer" is because we are providing personal trainers with tools that allow them to separate themselves from all other personal trainers out there. There is a tangible and measurable difference between the average personal trainer and the "Supertrainer," and as we continue development, this concept will become even more so apparent.
My question is... what evidence actually supports the claim for "Super Angels" to call themselves "Super". What separates these guys from all the other Angel Investors I've met, and all the other VC's I've met?
It certainly isn't the amount of money they're investing and it certainly isn't the number of companies they're investing in. Are they "riskier", and if so, how on Earth could you possibly quantify such a thing?
I challenge the name. If I am provided evidence that truly separates a "Super Angel" from the other kinds of investors out there, I may be able to accept such a claim, but as of now, it seems more like an overly hyped PR move.
I love what groups like YC are doing, but calling them "Super Investors" loses credibility in my mind.
Re: The New Funding Landscape
#13> As of now, few of the startups that take money from super-angels are ruling out taking VC money. They're just postponing it. But that's still a problem for VCs. Some of the startups that postpone raising VC money may do so well on the angel money they raise that they never bother to raise more.
I'm excited that this is the case. The way I see it, a small, focused group of people can get an extraordinary amount of good work done in a short period. The constraints of lean funding, to the tune of the $600,000 Paul describes, seem like the perfect way to keep focused for the first couple of years. Maybe they're an aberration, but my hat is off to 280 North for pursuing just this strategy. Raise a bit of cash, work hard, build cool stuff, stay focused. They got quite an exit out of it, (from any reasonable founder's perspective) but that's almost beside the point that they got to do their own thing without outside meddling. But maybe there are war stories I should hear before I commit to that position.
As soon as someone is shoving several million dollars into your pockets, they're also commanding you to spend it, which always seems to mean hiring people, bloating your team and throttling your momentum. (see Digg vs. Reddit) That sounds terrible. It also lets you delay figuring out how your company is going to actually generate some money one day, which strikes me as counterproductive.
I'd rather retain a nimble position. Communication is easy, focus is non-negotiable.
Re: The New Funding Landscape
#14> Since angels generally don't take board seats, they don't have this constraint. They're happy to buy only a few percent of you. And although the super-angels are in most respects mini VC funds, they've retained this critical property of angels. They don't take board seats, so they don't need a big percentage of your company.
Though that means you'll get correspondingly less attention from them, it's good news in other respects.
Do many founders consider the additional attention given and influence wielded by VCs as an advantage of taking funding from them?
Re: The New Funding Landscape
#15Angel investing is kind of a fad right now. Everyone's doing it. My gut instinct is that it's at least a mini bubble. In 3-5 years a lot of angels are going to be unhappy about negative returns, the stock market is going to be looking stronger, and they'll shift their money back to stocks and bonds. Surely this huge influx of angel investors has contributed to the much higher valuations early stage startups have been…
The question is who these angels are, really. More startups means hopefully more successful startups and hence more ex-founder angels. But there seems to be a weird trend of celebrities doing angel investing, and that will probably fade out of fashion.
Re: The New Funding Landscape
#16Ok. Negative points for my last comment justified. Here is my dilemma: Our company has created an online application we call "Supertrainer." The reason we named it "Supertrainer" is because we are providing personal trainers with tools that allow them to separate themselves from all other personal trainers out there. There is a tangible and measurable difference between the average personal trainer and the "Supertrai…
I don't normally downvote or harsh on comments because there are plenty of other people around here doing that, but in this case I'm going to apply the golden rule and give you some brutally honest feedback that I wish someone would give me if I were digging myself into a hole the way you are doing:
> I challenge the name.
If, as you say, you are trying to start a company then you should have twenty thousand more important things to do than to hang out here quibbling over some terminology that doesn't matter anyway. The "super angels" are what they are. What difference does it make if they aren't "super"? Or even "angels"? How is resolving this going to help you make your customers happier?
Those are rhetorical questions by the way.
Re: The New Funding Landscape
#17Angel investing is kind of a fad right now. Everyone's doing it. My gut instinct is that it's at least a mini bubble. In 3-5 years a lot of angels are going to be unhappy about negative returns, the stock market is going to be looking stronger, and they'll shift their money back to stocks and bonds. Surely this huge influx of angel investors has contributed to the much higher valuations early stage startups have been…
It depends how much of their wealth they are investing. It could be that many of them want be part of the startup scene without working on a startup of their own. Wasn't that the orignal idea of angels? So a return is a bonus.
Re: The New Funding Landscape
#18Ok. Negative points for my last comment justified. Here is my dilemma: Our company has created an online application we call "Supertrainer." The reason we named it "Supertrainer" is because we are providing personal trainers with tools that allow them to separate themselves from all other personal trainers out there. There is a tangible and measurable difference between the average personal trainer and the "Supertrai…
The article is pretty even handed and you'd do well to respond to the contents of it rather than getting stuck on the term "super angel." pg describes the differences between angels and super angels in concrete detail; see if you have something to say about his assessment there.
Re: The New Funding Landscape
#19He doesn't mention crowdfunding at all as model, though it's clearly generating enough funding for several businesses.
Re: The New Funding Landscape
#20Angel investing is kind of a fad right now. Everyone's doing it. My gut instinct is that it's at least a mini bubble. In 3-5 years a lot of angels are going to be unhappy about negative returns, the stock market is going to be looking stronger, and they'll shift their money back to stocks and bonds. Surely this huge influx of angel investors has contributed to the much higher valuations early stage startups have been…
Everyone who made a few hundred thousand $ and their sisters, turned into angel investors in the valley in the recent years.
The reason in my opinion is the prestige that derives from being a startup investor. I know at least 5-6 people who do this with one semi-successful startup as their experience.
Naturally, this means more supply which results to higher valuations and more startups being funded. So, the bar gets lower and I expect that the returns are not going to be great for most.