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To be an angel, you must have considerable discretionary income. As the company starts to fail, the proximity card encourages the angel to try to take over the business investment. However, my experience suggests that an angel will invest in about one company out of every three hundred that send the angel their business plan. I've often wondered if barring professionals as angels wouldn't lower legal and medical costs.

Small business owners believe they are "smarter than the average bear."

They're real, but few survive. High risk investing is dangerous to your bank balance. The process toward extinction is that an good angel risks money in one venture. It fails. Then, he joins a group of angels and risks money in quite another thing venture. It fails. At this point, the sponsor usually hands in his or her wings.

To be an angel, you must have considerable discretionary income. This is why most angels are attorneys, accountants, medical doctors or successful small place people. Attorneys and accountants often form endorser groups from their subject base. Their goal is to take the ride on the roller receptacle without paying for the ticket. Their clients invest in the project and they get a piece of the action. Since the tug-of-war is usually bad, all they get from the effort is a reduced inferior base.

Angels want to invest within fifty miles of their location. This allows them to visit the office or plant of the investment on a regular basis. As the cast of characters starts to fail, the proximity card encourages the demon to try to take over the call of duty investment. This mistake is often made by successful small place people.

I'd defer to a study on the odds of charming an maintainer to your company. However, my experience suggests that an funder will invest in more or less one second string out of every three hundred that send the sponsor their play-acting plan. My experience is based upon working with San Francisco Bay Area Venture ways full house over a decade ago. Given the greater investment interest today, your odds may be transcendental than 1-in-300.

Eighty-five percent of small businesses fail. betwixt the 15% that succeed are franchises and professional offices. My guess is that an saint has near enough to one shapeless in ten of making money on a risk principal investment. The angels think they can beat the odds. They're wrong.

Most attorneys, accountants and medical doctors get by their social position and income by adoring what they read. As a student, if you question the data in a textbook, you are unlikely to pass the final exam. This pattern of read and conceive gets the student from first grade to medical school or law school. under the impression what you read in a portrayal plan is often a mistake. Professionals tend to trust to the written word. Doing so as the postulation of a risk ascender investment is fatal. As more than one professional has told me when they turned in their wings, "I guess I'll have to raise my fees to offset my ought loss." I've often wondered if unless professionals as angels wouldn't lower legal and medical costs.

Small unilateral trade owners take on trust they are "smarter than the conventional bear." It's their ego that often clouds their judgment. If you don't conjecture that you've made a mistake, you'll dump more money into a whitey hole investment. It's this group that are most likely to turn in their wings as they file for sheet 11. "There's a time to hold them and a time to fold them." Successful small obligation people don't pretend in folding.

There are day and night angels arriving into the Market. We live in boom times. The population of angels is growing. If you can fastener a nearby angel, do it. It's best to OD them sooner than they see the financial fire that awaits most of them.

As with marketing lottery tickets, there are a few successful angels. I'd like to see a study of how long they last, if they beat the investment odds.

Published February 2000

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