What is an Angel? Private people investing their own money, The first outside cheque into a company, usually at pre-seed or seed. You back a founder before the institutions will.

What do they bring? The best angels bring more than capital: network, credibility, early customers, word of mouth.

Where you sit? You come in early and small. That converts into shares when the company raises a proper round. Then you get diluted. Every new round shrinks your slice. That's the price of getting in first.

What is the timeframe? Angel money is locked up for 7–10+ years. Returns only come at exit.

What is the risk? The highest risk asset arguably. Highest potential multiple.

Where do i find a deal? Your network is probably the strongest source, There's also groups like HSR, angel syndicates, and similar that can present opportunities.

What are the check size? There is no set numbers for checks, but high growth tech in US typical $10-25k+, but there is an enormous range of companies outside of that, from various industries, and countries, so you can get checks much lower than that.

As an investor, how do you spot companies like Lovable, Granola, Poppi and Uber before everyone else? The truth is: almost no one does. And even if you did, you wouldn't be let into most rounds. The median angels typically invest in a different kind of company: earlier, smaller, and with more modest outcomes.

The statistics are the following: 9 out of 10 companies fail, so the one that succeeds has to pay for all the ones that don't. That doesn't mean you have to invest in 10 companies (that's not how statistics work), but if you invest, know that the odds are not in your favor.

Let's talk about the risk of going to zero, and the probability of making 2x, 10x or 100x on your investment. The statistics above mean that losing everything is quite likely. So if a company doesn't have a real chance to return 10–100x, think carefully. Comparing it to a public mainstream company like Apple: it's highly unlikely that Apple goes to zero, the chance of getting your money back is real, and over time you might even make 10x. In simple words, if you don’t see a 10x possibility, the risk-return ratio is off. And let’s be blunt, most of us invest to make money.

Put the hours in, A study by Robert Wiltbank, Kauffman Foundation on angels and due diligence find, basically, that the more homework you do, the better your results. More precisely: The median angel spent about 20 hours on due diligence before investing. Investments with less than 20 hours returned about 1.1x on average. Investments with more than 20 hours returned about 5.9x. The top quartile, at 40+ hours, returned about 7.1x.

Develop a thesis. There's still some money to be made, but make sure you develop a strong thesis, have a clue, and put in the hours in the areas you invest in. Example, if you spend your free time optimizing health and biohacking, you might have a upper hand in those areas.

Right now, the companies that make it BIG are almost certainly playing the VC game from the very first round. I just went to a panel with 20VC, and they are currently calling BS on the industry itself, at the top of the market, it's hard to find companies raising rounds of less than $100M. Something to keep an eye on.

If you don't want to put in your hard-earned money, you can still own a piece of a company:

You're paid in common shares. And common shares get paid last because not all shares are equal. Institutions usually hold preferred shares, and preferred gets paid first, while common shareholders splits whatever's left.

How much "first" means depends on the liquidation preference. The standard is 1x: investors get their money back before anyone else. In tougher markets, terms get tougher. 2x is not unheard of.

The other part is dilution every time the company raises money, it issues new shares, and your slice gets smaller. The trade-off: each round should make the company more valuable. A smaller slice of a bigger company can still be worth more. It only works if the valuation grows faster than you're diluted.

So from the founders perspective the same facts are true, but you are working harder and more than every other owner. In my head that translates to: take as little capital as possible, and follow a reasonable scale if you have to. Personally, I really believe that bootstrapping is the OG rn.

An angel cheque is not just money. Your first investors will be on your cap table for a decade. They'll see your wins, your pivots and your worst quarter. Be as picky as you would be hiring.

What good angels bring. Money buys runway. Good angels bring intros, credibility, early customers. Ask every angel what they'll do beyond the cheque, and a vague answer is an answer.

Work with (and raise from) people you like. Do not underestimate the softer side of the deal. Dealing, and working with these people going forward will also be a win/loss.