This is a summary review of What Every Angel Investor Wants You to Know containing key details about the book.

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“What Every Angel Investor Wants You to Know” by Brian Cohen and John Kador is a practical guide for entrepreneurs seeking angel investment, providing insights from successful angel investors. (Full Summary…)

What Every Angel Investor Wants You to Know Summary Review

“What Every Angel Investor Wants You to Know: An Insider Reveals How to Get Smart Funding for Your Billion Dollar Idea” by Brian Cohen and John Kador is a comprehensive guide designed for entrepreneurs seeking angel investors. Brian Cohen, with his extensive experience as the chairman of the board of directors of the New York Angels, provides valuable insights into the intricate world of securing funding for innovative business ideas.

The book emphasizes the mutually beneficial relationship between startups and angel investors, stressing the importance of trust and understanding. Cohen, having invested in successful ventures like Pinterest, shares key elements that angels typically look for before committing to a startup. These include a well-defined exit strategy, a transition from “due” diligence to “do” diligence, authenticity, and a deep understanding of the customer’s perspective.

Cohen’s insider perspective is evident as he explores various aspects of the fundraising process, covering due diligence, crowdfunding, team building, scalability, and exit strategies. The book offers practical advice rather than just theoretical principles, making it a valuable resource for entrepreneurs navigating the complex landscape of angel investing.

One notable strength of the book is its emphasis on the emotional aspect of the entrepreneur-angel relationship. Cohen underscores the importance of creating an emotional connection, positioning the book as a guide not only for securing funding but also for building lasting partnerships.

While the book has received positive feedback from readers, it is not without its critiques. Some readers express a desire for more detailed information on financial aspects such as valuation and equity structure, suggesting potential areas for improvement in meeting certain reader expectations.

Essentially, “What Every Angel Investor Wants You to Know” stands out as a valuable resource for entrepreneurs seeking angel investment. Its combination of practical advice, emotional intelligence, and insider knowledge makes it a compelling read for those looking to navigate the challenging landscape of startup funding. The book provides a comprehensive guide for entrepreneurs seeking to understand the intricacies of securing angel investment and emphasizes the importance of building meaningful partnerships in the process.

Who is the author of What Every Angel Investor Wants You to Know?

Brian Cohen is a bestselling author. He was the first investor in Pinterest and numerous other industry leading startups.

John Kador is a bestselling business author and ghostwriter on leadership, finance, entrepreneurialism, and business ethics. He’s the author or co-author of over 25 books, including What Every Angel Investor Wants You to Know, The Manager’s Book of Questions, and Effective Apology.

How long is What Every Angel Investor Wants You to Know?

• Print length: 256 pages

What genre is What Every Angel Investor Wants You to Know?

Business, Entrepreneurship, Nonfiction

What are good quotes from What Every Angel Investor Wants You to Know?

“We are now seeing angels outsourcing due diligence to entities they assume will do it better. In one case, the entity is Y Combinator, the elite accelerator. Yuri Milner’s DST Fund and Ron Conway’s SV Angel fund recently announced that they will invest in every single startup coming out of Y Combinator. The seed rounds will provide $150,000 to every single one of the 40 startups that wants it, without any due diligence on their own part whatsoever. The capital is in the form of convertible debt with no cap and no discount. The loan will convert when and if the startup raises a proper angel or VC capital round at the same valuation that’s set in the round. Most convertible debt has a valuation ceiling and also gets a discount on conversion. The angels are banking on the premise that Y Combinator, in vetting the startups it stewards, has performed satisfactory due diligence. Milner has effectively shut out any other angel investors by offering such attractive terms. It’s almost free money. I’d be surprised if any of the 40 startups in each Y Combinator class decline such an offer.”

“According to the Global Entrepreneurship Monitor (Babson College and the London Business School), friends and family investing annually accounts for $50 to $75 billion in early stage capital in the United States. This is two to three times the amount of money invested annually by either angel investors or venture capitalists.”

“Loans are easier than equity. I generally think that offering debt is better than offering equity. When you offer F&F members equity, they are legally your business partners. Do you really want Uncle Freddy as a business partner? It’s better to treat such investments as loans. But if your F&F members insist on equity, try to make it nonvoting stock, so they can’t insist on being consulted on every management decision.”

“Seventy-five percent of success is predicted by your optimism level, your social support, and (perhaps most of all for entrepreneurs) your ability to see stress as a challenge instead of as a threat, according to Shawn Achor in a fabulous TED talk called “The Happy Secret to Better Work.”

“firstrate team with a second-rate idea will always outperform a second-rate team with a first-rate idea.”

“Burning bridges with one investor can cut off multiple sources because of their extensive networks.”

“The problem is, when are we ever satisfied?”

“Passion is an excellent guide for choosing hobbies but less so for choosing a business.”

“While some groups charge a fee for founders to make pitches, I don’t think entrepreneurs should be asked to pay anything. The angel investors are certainly rich enough and smart enough to get sponsors to offset any administrative costs.”

“Depending on the circumstances, they will invest either in the form of a Convertible Note (but with a cap on valuation),”

“Startups often make a fatal assumption when they attend presentations, business plan competitions, or demo days. They assume they are basically invisible until they take their place on the stage. Big mistake. The truth is, investors are observing you. We learn as much from watching your off-stage behavior as your canned presentation. Here’s a good way to go. Resolve that your formal presentation starts the moment team members leave their homes or offices and ends only when the last team member returns. At all other times, you are “on.” Assume the microphones are always on and someone has a camera phone on you at all times. Act like a disciplined team at all times. Watch what you say in the elevator or in the bathroom. You can’t believe the damaging stuff I’ve heard in bathrooms. Wait to debrief until you get back to the privacy of your office.”