- About the Lecture
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About the Lecture
What entrepreneur doesn’t long to be touched by an angel? This panel offers tips that might bring aspiring business people closer to that dream.
For good ideas that need a fast but small infusion of cash, angels are just the ticket, says Bob Greene. If you “sit down with someone over breakfast and they love” your plan, they “may write a check over coffee for $25,000.” But if you need more than half a million dollars, the better bet might be venture capital.
The best way to find your angel within the pool of an estimated 8.5 million U.S. millionaires, says John May, is through networking. Search your community for “cashed-out entrepreneurs and high net-worth individuals” using lawyers, accountants, tech councils and regional business incubators.
But, warns David Friend, “the worst time to meet them is when you’re trying to get money out of them.” Establish a friendly relationship with your potential angel, “talk about windsurfing or technology first, then come back and ask for advice.” Says Friend, “Most people like me who started their own business love to give advice -- it’s in the blood.”
The one area where seeking angel investors may prove fruitless is biotech, suggests Cynthia Fisher, who acted as her own angel when launching her first company. “Biotech is hot but there’s a long lead time: eight to 10 years of drug discovery and tens of millions of dollars, or north of that, with private equity.” Think venture capital and government funding, she recommends.
Pitch an angel “on nonfinancial areas,” suggests May: Say “I want your Rolodex and a shoulder to cry on, access to people to form a team, help with intellectual property.” This can lead to a “bond that lasts longer than a pure bank or VC relationship.”
But be careful what you wish for. Once on board, an angel investor may wish to offer guidance in an intrusive way. Fisher says, “It can be life or death based on do you have a shared vision for the long and short term goals of the company. It is a marriage.” Greene says, “You might meet a great billionaire angel who offers you a million dollars to start and you’re totally beholden to him or her. And then they control the cards. It’s good to diversify.” Ultimately, prepare to give up some control. Says Fisher, “He who has the gold, rules.” But responds, Green, “If managers are doing a decent job, the last thing a VC or angel wants is for you to toss the keys to them.”Related Videos
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- About the Speakers
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About the Speakers
Moderator: James Geshwiler MBA '00
Chairman, Angel Capital Education Foundation
Managing Director, CommonAngelsJames Geshwiler works with angel investors, venture capitalists, academic leaders and entrepreneurs around the country to foster better understanding of patterns and practices in angel investing.
Geshwiler joined CommonAngels in 1999, and since that time has participated in funding 24 companies through over 60 rounds of financing totaling more than $100 million as well as five M&A events and two shutdowns. Geshwiler is a contributing author to Cutting-Edge Practices in American Angel Investing,October 2003. He received a bachelor's degree from the University of Texas, Austin, a master's degree in political science from UCLA, and an MBA from MIT's Sloan School of Management.John May
Managing Partner, New Vantage Group
John May has been at the forefront of the angel investor movement. In 1991, he co-founded the Investors' Circle, a national non-profit group of 125 family and institutional investors working to grow the social venture capital industry. Additionally in 1996, he co-founded and became executive director of the Private Investors Network, an angel network sponsored by the Mid-Atlantic Venture Association, which he led until 2002.
May is now Chairman of the Angel Capital Association, a lead instructor for their "Power of Angel Investing" seminars, and is co-author of two books, Every Business Needs an Angel and State of the Art.
May co-founded The Dinner Club, an investment group of 60 regional angels who collectively invest in regional early stage ventures. In 2003, Active Angel Investors, a “pledge” fund was created. New Vantage Group administers all of these groups.Robert Greene SM ‘88
Managing Partner, Contour Venture Partners
Prior to launching Contour, Bob Greene was one of the three Managing Partners of Flatiron Partners, which was a leading venture capital firm focused on the information technology sector. The firm backed over 50 companies with more than $500 million of venture capital.
Before joining Flatiron full time in 1999, Greene was a General Partner at Chase Capital Partners (now known as JPMorgan Partners). He joined Chase Capital in 1994 when it was known as Chemical Venture Partners. In the ensuing five years he started, built and led Chase Capital's Technology and Internet practice, which included building the technology team and portfolio within Chase Capital.
Greene started his venture capital career in 1988 with Prudential Equity Investors (now known as Cornerstone Equity Partners) as a generalist private equity investor.
Greene received a BS from the Wharton School of Business and an M.B.A. from MIT Sloan.David Friend
CEO and President, Carbonite
Before his position with Carbonite, David Friend co-founded five companies: Sonexis, FaxNet, Pilot Software, Computer Pictures Corporation and ARP Instruments. He has been featured in numerous national magazines and newspapers, and Tom Peter's best-selling management book, The Pursuit of Wow!
Friend has been a lecturer at MIT Sloan. He is a trustee (emeritus) of the New England Conservatory, Berklee College of Music, and the Brookings Institution in Washington, D.C.Cynthia Fisher
CEO, BioMed 20/20 Technologies, Inc.
Cynthia Fisher was a co-founder and President of ViaCell, Inc., a cellular medicines company developing pharmaceutical grade cord blood stem cell products and human cellular therapies to treat diseases. Fisher also founded Viacord, Inc., now part of ViaCell, and served as President and CEO for eight years. Viacord, established in 1993, provides umbilical cord blood stem cell banking services for expectant families. In 2002, Fisher founded BioMed 20/20 Technologies, Inc., a healthcare and medical information products company.
Previously, Fisher was Marketing Manager for Haemonetics Corporation in charge of the Blood Bank Division and its blood cell separation products. She started her career with IBM Corporation and over seven years held various positions in sales and marketing.
Fisher is a trustee of Ursinus College and a member of the National Advisory Council of Harvard Medical School for Systems and Cell Biology. Cynthia received her M.B.A. from Harvard Business School and a bachelor's in Biophysics from Ursinus College. - About the Host
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About the Host
MIT Enterprise Forum
Video Player
Talk to an Angel: Crucial Connections to Early Stage Capital
- Moderator: James Geshwiler MBA '00
- John May
Robert Greene SM ‘88
David Friend
Cynthia Fisher - June 7, 2006
- Running Time: 1:29:19
