The statistics surrounding startups are astounding:
- 90% fail
- 80% of angel investments underperform
- 98.2% of startups never reach angel investing
What’s wrong with these facts?
As an asset manager and hedge fund manager for most of my adult life I’ve been used to the fact that people sought me to pitch a wide variety of projects in the hope that I would invest. What struck me, as I ploughed through the sometimes huge amount of material, was the fact that in most cases something of real substance was lacking, but to be honest, it was difficult to really put my finger on what that was. There were some ideas that did catch my eye and with the ones I felt a connection with, I took the plunge and began the process of due diligence that eventually led to investment.
As a result, my curiosity was aroused as to why some projects were investible, whereas others seemed destined to remain invisible. I started to read everything I could lay my hands on relating to the investing landscape and joined several professional associations across two continents. In time, through the knowledge I gained and my increasing publicly recognised authority on the subject, I was invited to deliver seminars and workshops based on my experiences of the angel investor/entrepreneur relationship, particularly as this related to funding startups. These events were the catalyst that prompted me to think about what wasn’t working, not just for me, but also for my fellow investors as well as for the entrepreneurs who approached me for funding. Thus began my quest in creating a unique framework that, once implemented, would ultimately offer entrepreneurs a definitive set of tools which would enhance their proposals, whilst at the same time, allowing investors to, at least, partly derisk their investments.
There are a few key questions to ask, both as an entrepreneur and as an investor.
Wouldn’t you spend a few hours answering the right questions instead of spending months and a lot of money to correct the course later on?