I have seen many people comment about angel investing, and this is a valuable perspective. In particular I was happy to see him comment on the percentage of ownership to look for.
> Be Wary of Entrepreneurs Who are Building for Businesses They Have No Experience In
Does anyone have any advice on this? What if you want to do (for example) a startup in music, but don't come from a music background. Can you mitigate this point by having a few advisors and research to back your project up? Do you need a founder with direct experience in it?
We were of the opinion that we're coming from outside the box is a great thing - we know whats broken and how we'd fix it, whereas if you grew up in the industry you might not be aware of it.
Coming outside the box is a great thing. If you're in a startup versus a big corporation, you're already enabled to work outside the box versus typically being stifled. My issue is that I've met entire teams who had, upon further conversation, skewed or incorrect impressions on how an industry worked. I think this is dangerous and will cause extra "bobbing and weaving" in their strategy, which costs them in time and money: money that an early stage startup doesn't have much of.
So I look at this as a probability game: you don't want to lower the odds of success by not really knowing how an industry works but raise it. Some possible solutions are having advisors and being open to research, but I've also seen teams who didn't have resident founders not really act on advice or research. It's much better to have a founder who has direct experience with that industry to be a daily, trusted member of the team pushing in the right direction constantly BUT you have to not be discouraged by the way an industry currently operates; you must have belief, focus, and drive to push disruption to change the rules of the industry you're attacking. What often happens with resident industry experts is that the team gets discouraged by all the barriers - to me this is the killer of an idea, not the knowledge.
Can you be a success without having a founder from the industry? Sure - look at Paypal who defied normal conventions of banking, amongst other really big examples of disruption. Let's just say there are many factors that drive success and that being disruptive is only one. Again, it's a probability game and you want to load the odds in your favor for success, not lower them...
I attended AngelConf too and it was very instructive. Both for entrepreneurs and for budding angels.
The only thing missing was some kind of template, or recipe for becoming an angel. We heard from 10+ amazing current angels, so you can sort of figure out what the rules and best practices are.
But it didn't tell you: if you want to become an angel today, do X (or join X). That's the question I was hoping to answer at AngelConf.
