Presentation held at FiBAN's business angel day 20.9.2012. wwww.fiban.org/billreichert

1. The Art of
Angel Investing
FiBAN
September 20,2012
Bill Reichert
Managing Director
Garage Technology Ventures

2. Top Ten Myths of
Angel Investing

3. Myths of Angel Investing
1 “Invest in what you
know.”
Reality: Most winners are black
swans

4. Myths of Angel Investing
2 “Focus on making
money.”
Reality: Need to focus on
creating value.

5. Myths of Angel Investing
3 “The key is good due
diligence.”
Reality: The key is good intuition

6. Myths of Angel Investing
4 “Don’t let emotions
cloud your decision.”
Reality: Recognize your
emotions; don’t deny them.

7. Myths of Angel Investing
5 “Build consensus
among a syndicate of
investors.”
Reality: Controversial
investments do better

8. Myths of Angel Investing
6 “Success comes
from adding value.”
Reality: The harder you work,
the less successful the startup

9. Myths of Angel Investing
7 “Make sure you
protect yourself.”
Reality: Keep it simple; don’t
invest if you are worried about
control.

10. Myths of Angel Investing
8 “Valuation is
important.”
Reality: Shared expectations are
more important.

11. Myths of Angel Investing
9 “It’s cheap to start a
company now.”
Reality: It’s really expensive to
build a successful company.

12. Myths of Angel Investing
10 “Diversify your
portfolio.”
Reality: Make few big bets, and
buy options in several others.

13. Other Tips . . .
• Your influence is not based on the
size of your check
• Buy high, sell higher; there’s no such
thing as a bargain in venture capital
• Don’t chase fads; once a sector is
hot, you are probably too late

14. Other Tips . . .
• Monitor the “Surprise Ratio”: Positive
surprises to negative surprises
• Lower expectations do not result in
higher returns
• Learn from your mistakes; better yet,
learn from the mistakes of others

15. The Art of Angel Investing
Bill Reichert
reichert@garage.com