NEAR APAC, the largest global blockchain conference in Vietnam, is set to take place on September 9th-10th, 2023, at Thiskyhall Sala Convention Center in Ho Chi Minh City. The event promises to be a global gathering, bringing together leading blockchain experts, developers, students, enterprises, and startups from the Asia-Pacific (APAC) region and beyond.
What is NEAR APAC 2023 and why you should attend?
Themed “Unlimited Future,” NEAR APAC will serve as a platform for exploring the latest advancements in blockchain technology and multi-chain decentralized applications within the APAC region. The conference will offer a diverse range of activities designed to engage and inspire participants beyond traditional panel discussions and keynote presentations.
Participants can immerse themselves in a virtual reality playground, explore the Web3 Dating zone tailored for startups and venture capitalists, witness cutting-edge technology demonstrations, and partake in thrilling NFT and gaming activities. NEAR APAC also aims to provide a dynamic and interactive environment that fosters networking, collaboration, and the exploration of emerging technologies.
With over 8,000 expected attendees, NEAR APAC is set to attract a wide array of participants, including 100+ global blockchain leaders as speakers, 1,000+ developers and students from 10+ universities, 300+ projects and startups, and representatives from 100+ enterprises.
Activities and Opportunities
Thinkhall convention – deep discussion about the development of Web3 in APAC (Source: nearapac.org)
The conference offers unique opportunities for each target audience:
Builders: NEAR APAC will host a Web3 Hackfest, Web3 Code Challenge, and Builder stage with the prize pool $110,000, providing developers with a platform to showcase their skills and engage in collaborative coding sessions. The conference will also feature a dedicated hacking area for participants to further explore their ideas. Learn more at https://web3hackfest.org/.
VCs and Start-ups: Wiziin is thrilled to partner up with GFI – the co-organizer of NEAR APAC in hosting The Greenhouse Program – which offers startups an opportunity to join 1:1 pitching sessions with top tier VC funds in the regions, whose main focus is on Blockchain, Web3 and innovative technology solutions. The Greenhouse Program brings venture capitalists on board as speakers, partners, and judges for the Hackathon. Start-ups can benefit from the guidance and support of experienced investors. Visit https://nearapac.org/the-greenhouse/ for more information.
Blockchain Community, IT Students, and Start-ups: NEAR APAC hosts the Web2 & Web3 Career Fair in collaboration with TOP CV, Vietnam’s largest recruitment platform. This unique opportunity allows start-ups and projects to connect with talented individuals and find suitable candidates for their companies.
NEAR APAC is further elevating the event experience with additional attractions designed to captivate and engage attendees. A Web2 technology show will feature fascinating displays such as robot beer servers, holograms, and flying motorcycles. A travel game with a substantial prize pool will incentivize participants to explore every booth, maximizing the benefits for booth sponsors. By completing tasks and collecting NFTs, participants will have a chance to share in the $15,000 prize pool. These activities aim to drive user engagement and provide booth sponsors with maximum marketing exposure during the event.
Register now and secure your place at the forefront of the blockchain revolution.
About NEAR APAC:
NEAR APAC is Vietnam’s largest blockchain/crypto conference entity, focused on showcasing the latest advancements in blockchain technology and multi-chain decentralized applications within the APAC region. With its “Unlimited Future” theme, NEAR APAC aims to foster networking, collaboration, and the exploration of emerging technologies in an interactive environment. For more information, visit https://nearapac.org/.
Register now at https://nearapac.org/ticket and secure your place at the forefront of the blockchain revolution.
The “Navigating the Fundraising Landscape” event was held with great success, providing valuable insights and practical guidance for founders and investors in Vietnam. Organized by Carta and Wiziin, the event aimed to equip participants with the necessary knowledge to navigate the ever-changing fundraising landscape.
The event began with an opening and warm welcome, setting the tone for an engaging and informative session. The past year was acknowledged as a period of significant transformation in the fundraising landscape, making it crucial for founders in Vietnam to understand and navigate the unpredictable nature of the current environment.
Carta, an ownership and equity management platform, delivered a keynote presentation that shed light on the current fundraising landscape. Ms. Vanessa Chin, a Senior Executive from Carta, provided valuable insights, data, and practical tips to navigate the fundraising journey successfully.
Following the keynote presentation, a fireside chat took place with Ms. Vanessa Chin as the moderator. The chat focused on discussing the current state of fundraising and sharing panelists’ experiences, and strategies for success. The esteemed panelists included Mr. Tien Nguyen, Co-Founder & CEO of Wiziin, and Mr. Eddie Lee, Co-Founder & CEO of Pilon. Their diverse backgrounds and expertise added depth to the discussion.
During the fireside chat, various aspects of fundraising were covered. The first part examined the global and Southeast Asian fundraising landscape, highlighting the surge in fundraising activity and the challenges faced by startups and investors alike. Mr. Tien Nguyen shared his insights into the unique characteristics and opportunities defining fundraising in the Southeast Asian market, while Mr. Eddie Lee provided his perspective on the changing funding landscape in the region.
The second part of the fireside chat delved into the role of founders in the current fundraising landscape. Mr. Tien Nguyen offered valuable insights into the factors venture capitalists consider when evaluating and selecting potential investments. He emphasized the need for founders to align their strategies to attract venture capital. Mr. Eddie Lee shared critical lessons he learned from his entrepreneurial journey, offering practical advice to fellow founders.
In the final part of the fireside chat, the focus shifted to startup capital utilization. Mr. Tien Nguyen highlighted common pitfalls that founders should be aware of when managing and allocating their startup capital, along with strategies to optimize its usage for maximum impact. Mr. Eddie Lee shared practical tips and best practices based on his own entrepreneurial experiences, aiming to help founders make the most out of their available capital and drive sustainable growth.
The event concluded with a Q&A session, allowing participants to seek further clarification and guidance on fundraising-related topics. The speakers’ expertise and perspectives gave the audience a deeper understanding of navigating the fundraising landscape.
A closing remark expressed gratitude to the speakers, partners, and sponsors for their support in making the event a success. We did take a group photo to capture the memorable moment, and attendees were invited to stay for a networking opportunity. This offered a chance to connect with fellow founders and investors, fostering knowledge sharing and collaboration.
Overall, the “Navigating the Fundraising Landscape” event was a valuable platform that provided practical insights and actionable advice for founders and investors in Vietnam. It equipped attendees with the necessary knowledge and strategies to successfully navigate the fundraising landscape and achieve their fundraising goals.
Thanks to our speakers and attendees for attending the event and for your valuable contribution. It was our pleasure to see you at the event, and we are hoping that it gave you an insight into the fundraising landscape.
When it comes to investing in startups and emerging businesses, two primary options exist: Angel Syndicates and Venture Capital. Angel Syndicates comprise high-net-worth individuals who pool their resources to invest in startups. Conversely, Venture Capital firms are institutional investors that invest substantial amounts of money in established startups.
Choosing the right investment type is crucial for both investors and entrepreneurs. It’s important to consider the level of control, ownership, and financial returns that each investment type offers. Angel Syndicates may offer more flexibility and personal touch, while Venture Capital firms may provide more extensive resources and support.
This article provides a definition of Angel Syndicates and Venture Capital and emphasizes the significance of selecting the appropriate investment type. The comparison between the two investment types, including differences in investment size and structure, investor involvement, risk and return, and factors to consider when choosing between the two, is also outlined.
What is Angel Syndicates?
Angel Syndicates are groups of high-net-worth individuals who come together to invest in startups. Here are some essential characteristics of Angel Syndicates:
Angel Syndicates generally invest in earlier-stage startups, providing seed funding to help these companies get off the ground. However, some larger syndicates may also invest in later-stage startups.
The syndicates are usually made up of high-net-worth individuals who invest smaller amounts of money compared to Venture Capital firms. However, the total amount invested by a syndicate can be more significant than that of a VC firm in some cases.
Angel investors often provide guidance and expertise to the startups they invest in, which can be highly valuable for entrepreneurs who are just starting.
Advantages and Disadvantages of Angel Syndicates
On the one hand, Angel Syndicates offer more flexibility and can provide a more personal touch when working with startups. They are often more willing to take risks and invest in companies that may not have established traction yet. However, the investment amounts may be limited, and the risks can be higher. Angel Syndicates may not have the same level of resources and support that Venture Capital firms can provide.
Here are some examples of successful angel syndicate investments and the key players involved. Chris Sacca, an angel investor, played a significant role in Uber’s early growth, and today the ride-hailing company is a household name. Dropbox, a widely used cloud storage platform, received seed funding from angel investors including Sequoia Capital and Accel Partners. In the case of Reddit, a group of angel investors such as Paul Graham and Alexis Ohanian provided seed funding for the development of the site, which has since become one of the most popular social news aggregators on the web.
What is Venture Capital?
Venture Capital is a form of private equity financing primarily offered to early-stage startups and emerging businesses. Here are some of Venture Capital’s key features:
Venture Capital firms typically invest larger amounts of money compared to Angel Syndicates, offering funds to startups that have already established a certain level of traction.
They offer more extensive resources and support to their portfolio companies, such as access to industry expertise, mentorship, and networks of contacts.
Venture Capital firms play an active role in the management and decision-making of their portfolio companies.
Pros and Cons of Venture Capital
Venture Capital firms offer more substantial financial backing and access to a wider range of resources and support. They can help entrepreneurs to scale their businesses more quickly. Otherwise, VCs also tend to be more risk-averse and may be less willing to invest in companies that haven’t already established some level of traction. They may also take a more hands-on approach to management, which can limit the autonomy of the startup.
There are several examples of successful venture capital investments. Accel Partners was an early investor in Facebook, providing seed funding for the social media platform’s early growth. Sequoia Capital and Greylock Partners provided seed funding for Airbnb, which has since become a global leader in the short-term rental market. Another is that Founders Fund provided funding for SpaceX, which has since become one of the most successful private space exploration companies in the world.
Which one is right for your Startup?
According to Bo Ren, was a director of Early-Stage Startups at Silicon Valley Bank in New York City. She believes that founders should understand the differences between angel syndicates and venture capitalists (VCs) to determine which is more suitable for their startup. Angels can offer more than just funding, providing human capital and objective advice that can be valuable in the early stages. They may also be more willing to invest in underestimated founders such as women and BIPOCs. Angels can help startups overcome the cold start problem and create a social signal to VCs that the company is legitimate. However, the partnership with angels may be shorter than with VCs, who work on a longer timeframe and can provide the push for startups to sell upstream to bigger clients.
In terms of which type of investor is more suitable for a startup, it depends on the founder’s goals and stage of development. If a startup has found product-market fit and needs distribution, partnerships, or key hires, VC funding may be the push needed to scale up quickly. As having a spot in VC’s portfolio, they can try to help you easier to hit a milestone. However, if a founder is still testing things out and needs freedom to explore, venture capital may not be the best option. Ultimately, the first question for founders should be whether they truly want to be venture-backed, and if so, whether it is the only way to achieve their growth goals.
Final Thoughts
Choosing the appropriate investment type can be a critical factor in the success of a startup. Angel Syndicates offer smaller investment amounts with more involved support, while Venture Capital firms provide larger investments and take a more active role in management. Each investment type presents different risks and potential returns.
When considering whether to pursue Angel Syndicates or Venture Capital, entrepreneurs should evaluate the investment size required, the stage of their company’s development, and the level of involvement desired from the investor. It’s crucial to consider the potential trade-offs, such as control, ownership, and financial returns.
Looking to the future, both Angel Syndicates and Venture Capital firms are likely to continue playing significant roles in the investment landscape. As the startup ecosystem continues to evolve, new investment models may emerge, providing even more funding options for entrepreneurs.
Angel syndicates are groups of individual investors who pool their resources to invest in early-stage or high-growth companies. These groups provide startups with the capital they need to grow and succeed while offering investors the opportunity to invest in promising companies and potentially earn high returns.
However, investing in angel syndicates comes with legal and regulatory implications that are important to understand. This is because these investments involve securities laws, investment regulations, and compliance requirements that can impact both the investors and the startups.
Legal Framework for Angel Syndicates
Angel syndicate investments fall under the purview of securities laws and regulations, which are designed to protect investors and ensure fair and transparent markets. Therefore, understanding these laws and regulations is crucial for both investors and startups.
Securities laws
Securities laws are a set of regulations and laws that govern the issuance, trading, and sale of securities, such as stocks, bonds, and other financial instruments. These laws are designed to protect investors from fraud, deception, and other forms of misconduct in the securities markets.
Securities laws vary from country to country but typically cover a range of issues related to the buying and selling of securities, including the registration and disclosure requirements for issuers, the qualifications and licensing requirements for brokers and dealers, the reporting and record-keeping requirements for market participants, and the rules governing insider trading and market manipulation.
In the United States, the Securities Act of 1933 and the Securities Exchange Act of 1934 are two key pieces of legislation that form the basis of federal securities laws. Other countries have their own securities laws and regulatory bodies, such as the Financial Conduct Authority in the UK, the Autorité des marchés financiers in France, and the Securities and Exchange Board of India.
Anti-fraud laws
Anti-fraud laws are a set of regulations and legal provisions designed to prevent and prosecute fraudulent activities in financial markets. These laws aim to protect investors and the integrity of the financial system by ensuring that investment opportunities are presented fairly and honestly.
Anti-fraud laws prohibit a wide range of activities, including misleading statements, misrepresentations, and omissions of material facts. They also require that companies disclose relevant information to investors, so they can make informed investment decisions. In the United States, the Securities and Exchange Commission (SEC) enforces anti-fraud laws, such as the Securities Act of 1933 and the Securities Exchange Act of 1934.
Anti-fraud laws, such as the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940, are also relevant to angel syndicates because they help prevent fraudulent activities in the securities market. Angel syndicates, like any other investment group, are subject to regulations aimed at protecting investors from fraudulent activities. These laws prohibit fraud in connection with the purchase or sale of securities and require investment advisers to register with the SEC and comply with certain regulations. Failure to comply with these laws can result in civil and criminal penalties.
The Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Company Act, and anti-fraud laws are all part of the legal framework for angel syndicates in the United States. These laws and regulations are available on the official website of the U.S. Securities and Exchange Commission (SEC), which is the primary regulatory agency that oversees angel syndicates. Information on the SEC’s role and responsibilities can also be found on its website. Additionally, the websites of the Angel Capital Association and other organizations related to angel investing may provide further information on the legal framework and regulatory environment for angel syndicates.
Regulatory Environment for Angel Syndicates
Angel syndicates are subject to regulatory oversight from various agencies and organizations. (This applies to all angel syndicates, regardless of the country in which they operate.) Understanding the regulatory environment is important for both investors and startups to ensure compliance and avoid penalties.
In the United States, the SEC is the primary regulatory agency that oversees angel syndicates. The agency has the authority to investigate and enforce securities laws and regulations, including those related to angel syndicates. The SEC also provides guidance and resources to help investors and startups navigate the regulatory landscape.
Aside from the SEC, there are other organizations and associations that provide guidance and support for angel syndicates. For example, the Angel Capital Associationis a trade organization that provides resources and education for angel investors and startups. Angel syndicates (angel groups) are also subject to reporting requirements and compliance obligations. In others words, startups that receive funding from angel syndicates may be required to file periodic reports with the SEC and provide updates to their investors. Similarly, angel syndicates may need to comply with certain restrictions and disclosure requirements to remain in compliance with securities laws and regulations.
Finally, investor protections are also an important aspect of the regulatory environment for angel syndicates. These protections may include disclosure requirements, anti-fraud provisions, and other measures designed to ensure that investors are informed and protected from potential risks. (The specifics of regulatory oversight and reporting requirements may vary depending on the country in which the angel syndicate operates.)
Applicable laws and regulations in other countries
This refers to the set of laws and regulations that specifically apply to angel syndicates in countries other than the United States. These laws and regulations may vary from country to country and may be influenced by factors such as cultural norms, economic conditions, and political systems. It is important for investors and startups to understand the legal framework in each country where they plan to invest or operate in order to ensure compliance and avoid legal penalties. For example, in the United Kingdom, angel syndicates are subject to the Financial Services and Markets Act 2000, which regulates the promotion and sale of financial products and services. In Australia, the Corporations Act 2001 regulates the offering of securities to investors.
In Canada, angel syndicates are subject to the Canadian Securities Administrators (CSA), which is an umbrella organization composed of provincial and territorial securities regulators. The CSA oversees the regulation and enforcement of securities laws in Canada, which includes the regulation of angel syndicate investing.
In Europe, the Alternative Investment Fund Managers Directive (AIFMD) provides a regulatory framework for angel syndicate investing. The AIFMD sets out requirements for the authorization, operation, and transparency of alternative investment fund managers, which includes angel syndicates.
While there are differences in the specific laws and regulations governing angel syndicates in different countries, they all share the common goal of protecting investors and promoting transparency in the investment process. Investors in angel syndicates should familiarize themselves with the relevant laws and regulations in their jurisdiction, as well as seek legal and professional advice to ensure compliance and minimize risk.
Conclusion
In conclusion, understanding the legal and regulatory landscape of angel syndicates is critical for investors and startups alike. This includes complying with securities laws and regulations, reporting requirements and compliance obligations, and investor protections.
Investors should also carefully consider the risks and challenges of angel syndicate investments and take appropriate steps to mitigate them, including seeking legal advice, diversifying their portfolios, and investing only in opportunities that align with their goals and risk tolerance.
As the world of angel syndicate investing continues to evolve, we can expect to see increased regulatory scrutiny, the rise of alternative investment structures, and the adoption of new technologies to streamline the investment process.
Suggestions for reference:
“Angel Investing: The Art of Finding and Closing Startup Investments” by David S. Rose (2014)
“Angel Financing in Asia Pacific” by John O’Farrell (2015)
“Securities Law: A Guide to the 1933 and 1934 Acts” by Thomas Lee Hazen (2018)
Pitching to angel syndicates can be a nerve-wracking experience for many startups. However, it is also an essential step in securing the funding needed to grow and scale your business. In this article, we’ll walk you through the process of how startups pitch to angel syndicates.
The Pitching Process
The process of pitching to an angel syndicate involves several steps:
Identify Angel syndicate
The first step is to identify potential angel syndicates that are a good fit for your startup. This can be done by researching online, attending networking events, and seeking referrals from other entrepreneurs. Online platforms such as Gust, AngelList, and SeedInvest,… can also be used to connect with angel syndicates.
Submit a pitch deck
Once you have identified an angel syndicate you want to pitch to, the next step is to submit a pitch deck. This is a presentation that outlines your business idea, market opportunity, financial projections, and team. Tailoring your pitch deck to the specific interests of the angel syndicate is crucial. Pitching to an individual investor allows for a more informal and flexible process, with more control over timing, format, and content. This approach may lead to establishing a personal relationship with the investor and receiving personalized feedback. In contrast, when pitching to an angel syndicate, the process is typically more structured and formalized. Startups must adhere to specific guidelines for submitting their pitch and may need to follow a specific timeline for review. The pitch may be presented to a group of investors, requiring a tailored approach to a larger audience and addressing a broader range of concerns and questions.
Do the screening process
Switch to the next step, the angel syndicate will conduct a screening process to determine if your startup is a good fit for their investment portfolio. This may involve initial phone or video interviews, due diligence on your business, and discussions with your team.
Get the invitation
If your startup passes the screening process, you will receive an invitation to pitch to the angel syndicate. The pitch may take place in person or virtually and should be tailored to the interests of the specific angel syndicate. Unlike pitching to individual investors, you may pitch in front of a group of investors in a syndicate.
Do due diligence
Following the pitch, the angel syndicate will likely have questions about your business and conduct further due diligence. It is essential to be prepared to answer questions and provide additional information as needed. Due diligence may be faster with an angel syndicate as they have a network of experienced investors who can evaluate potential investments better than just individual investors. Angel syndicates can also pool their resources and share the cost of conducting due diligence, which can be an advantage for startups.
Wait for the investment decision
Finally, the angel syndicate will make an investment decision. If they decide to invest, they will negotiate terms with your startup and provide funding to help you grow and scale your business. Throughout the pitching phase, it’s important to build a relationship with the investors. Maintaining good communication and following up with investors can help startups gain valuable feedback and insights, which can be beneficial for future rounds of fundraising or even for the growth of the business.
Benefits of Pitching to Angel Syndicates
There are several benefits of pitching to angel syndicates. First, angel syndicates are groups of angel investors who pool their money together to invest in startups. Pitching to angel syndicates provides access to a group of investors who can provide a significant amount of funding. Second, angel syndicates typically have experience in investing in startups in many industries, so they can provide valuable and manifold advice and mentorship. Finally, pitching to an angel syndicate can help startups gain exposure and credibility in the startup ecosystem, which can be crucial in attracting future investment and partnerships.
As the above words, angel syndicates typically consist of a group of experienced and successful angel investors who have a proven track record of investing in successful startups. By successfully pitching to an angel syndicate, a startup can gain access to this network of investors, who can provide not only funding but also mentorship, guidance, and valuable connections within the industry.
Pro-Tips to Pitch Successfully
Pitching to angel syndicates can be a nerve-wracking experience for many startups. However, preparing a successful pitch can be the difference between securing the funding needed to grow your business or walking away empty-handed.
To help you prepare, we’ve compiled a list of pro tips to help you pitch successfully to angel syndicates.
Know your audience: Research the angel syndicate you are pitching to and tailor your pitch to their interests and investment criteria. This will show that you have done your homework and increase the likelihood of securing funding. Consider their investment history, their portfolio companies, and what types of startups they are interested in investing in.
Keep it concise: Your pitch should be no longer than 10-15 minutes, including time for Q&A. Focus on the most important aspects of your business and avoid getting bogged down in unnecessary details. Make sure your pitch is clear, concise, and easily understandable.
Be clear and compelling: Your pitch should clearly explain your business idea, market opportunity, and team. Use compelling visuals and stories to bring your pitch to life and engage your audience. Make sure you can explain your idea in a way that is easy to understand and that captures the interest of your audience.
Show traction: Investors want to see that your business has traction and is making progress. Be prepared to share metrics and milestones that demonstrate your startup’s growth and potential. This could include user acquisition, revenue, partnerships, and other key metrics that will showcase your traction.
Practice, practice, practice: Practice your pitch until you can deliver it confidently and smoothly. This will help you stay calm and focused during the actual pitch and increase your chances of success. Practice in front of friends, mentors, and other entrepreneurs who can give you feedback on your delivery and content.
Final Thoughts
Pitching to angel syndicates is a challenging yet rewarding process for startups. To increase the likelihood of securing funding, startups should follow the steps outlined in this post. It’s important to tailor the pitch to the angel syndicate’s interests, be prepared to answer questions, and provide more information as required. Good luck with your pitch!
The digital economy of Southeast Asia is expected to reach $1 trillion by the end of the decade. In addition to having the world’s second fastest growing region in terms of internet users, the region has seen the rise of its own multi-service tech unicorns that provide a wide range of services ranging from food delivery to ride-hailing to online learning to digital banking.
Four factors have contributed to the rapid growth of the digital economy in Southeast Asia. ✔️ For starters, a large youth population of digital natives has significantly contributed to the sector’s growth. ✔️ Second, the rapid adoption of mobile financial services is enabling millions of people to make digital payments. ✔️ Third, because the region has such high mobile penetration, customers frequently use e-commerce and social media sites to purchase goods and services. ✔️ Finally, most governments in Southeast Asia have implemented policies to support the digital economy and infrastructure.
According to McKinsey & Company, the proportion of digital payments in Asia will reach 65% in 2024 (compared to a global average of 52%), making the continent the world’s consumption growth engine. There is no doubt that digital growth in Southeast Asia is accelerating. However, several areas must be improved in order for the region to reach its full potential: digital infrastructure, new consumer development, information security, and effective digital policy.
According to World Bank data, Vietnam’s digital sector is growing at a rate of 10% per year and could reach more than $200 billion by 2045, a massive figure compared to the country’s GDP, which was nearly $352 billion last year. For Vietnam to achieve its goals of becoming a high-income country and a “net-zero” emissions economy, digital transformation will be critical.
The automatic trading system is an important sector of the digital transformation industry. C&T Electronic Company is a growing science and technology company that specializes in automatic trading systems. C&T helps customers streamline their operations and leverage consumer experiences through innovative solutions and cutting-edge technology. C&T wants to contribute to speeding up the Vietnamese digitization process.
Currently, C&T is seeking capital in seed funding to further expand its offerings and strengthen its position in the market.
Finding and matching with angel investors can take a lot of time and effort. Due to this, angel investors are increasingly banding together to form syndicates. As a founder, it could be better if choose a syndicate over an angel investor, or converse. In spite of relatively the differences between these two terms, they are used often interchangeably. Let’s examine the differences between both.
Angel syndicate vs Angel investor
What is Angel Investor?
An angel investor or a seed funder is a high-net-worth-individual, who invests their own money in startups in the seed or early stage to alternate for convertible debt or possession fairness. This is the cardinal phase of constructing a startup’s business enterprise and finding out its fatality.
In most instances, angel investors put money into startups with a prominent level of risk. They will follow the businesses’ plans for at least 5-7 years to assist agencies to regain the capital. They often claim a sizeable proportion of the organization because the likelihood of failure is extraordinarily excessive.
The investment of angel investors varies at different tiers. It is able to be low around $5k, or maybe higher, about $100k. Commonly, it takes 1-6 months for these angels to finish their offers. This timeframe includes due diligence in your organization and time period sheet negotiation.
What Angel Investors benefit Startups
Angel investors can offer greater flexibility in investment terms and can tailor their investment to the specific needs of the startup. Moreover, working with individual angel investors can result in a more personal and collaborative relationship with founders. Because of the perhaps smaller fund, angel investors may offer a simpler and more streamlined investment process than angel syndicates.
What drawbacks Startups should consider
As above-mentioned, an individual angel investor could sink money into a startup a bit more ‘humble’ than a syndicate. Furthermore, even if some angel investors fund with their real-angel purposes, others could require varying degrees of control and benefits over your business.
What is Angel Syndicate?
An angel syndicate is a group of investors who agree to invest in the same project together. These investors are able to be from any source in dissimilar industries. A lead angel of the syndicate will present deals to its contributors. Individuals then decide whether or not to invest their personal funds in the organizations on offer. Angel syndicates handle the deal flow, due diligence, and transactions for their investors. Angel syndicates typically take 1-6 months to complete their transactions
A syndicate not only permits investors to diversify their investments and percentage any dangers with other fellow angel traders but also makes the funds in higher amounts compared to individual angel investors for startups, which could be up to 1 million dollars in some cases.
What Angel Syndicates benefit Startups
Via the angel syndicate, startups can have a chance to reach a group of HNWI members without self-finding each. It could benefit startups in the next round.
Angels in a syndicate may from a variety of backgrounds and industries, providing valuable insights and advice. This platform will act as a conduit for its investors to process, execute, negotiate, and conduct due diligence on startups. As a result, founders do not have to deal with numerous and disparate investors.
What drawbacks Startups should consider
A large investment from a syndicate may require control right. When startups opt for angel syndicates to raise capital, it can result in dilution of ownership. This may cause the startup founders to have less control over their company.
Furthermore, conflicts of interest may arise among syndicate members due to different investment goals or priorities. This can complicate the investment process and startups may bide for a longer time to get the decision of syndicates. Therefore, startups must carefully consider these potential disadvantages before deciding to go with an angel syndicate investment.
Final Thoughts
In conclusion, both angel investors and angel syndicates are able to give valuable resources and support to startups, such as capital, business expertise, and contact networks. However, there are some key distinctions between the two types of investors that startups should bear in mind when deciding which approach to take.
Individual angel investors may provide greater flexibility, a more personal relationship, as well as a better-streamlined investment process. Nevertheless, they could offer less funding and limited access to networks and resources.
Angel syndicates, notwithstanding, can provide larger amounts of funding, broader networks and expertise, and a more diverse range of perspectives. Alternatively, they may also involve more complex investment terms, reduced control for the founding team, and potentially greater risk of conflicts.
Ultimately, the decision of whether to work with individual angel investors or an angel syndicate will depend on the specific needs and goals of the startup, as well as the preferences and priorities of the founding team. By carefully weighing the pros and cons of each approach, startups can make informed decisions that will best position them for success in the competitive world of entrepreneurship.
A syndicate is a popular venture capital alternative. Today, we will discuss the benefits and drawbacks of an angel syndicate platform for an investor considering joining this network. We hope you enjoy the post and get the best choice to decide whether to join.
What is Angel Syndicate?
We did explain in Angel Syndicates 101 that an angel syndicate is essentially a group of investors who agree to invest together in a specific project. A syndicate can include angels or investees from any source; syndicates frequently include angels from more than one investment network. While no additional conditions are required, in order for the syndicate to be viable, all investors would typically reach a (non-legally binding) agreement on how the syndicate will operate.
In an angel syndicate platform, there has a professional who manages the network, screening potential investments and making recommendations to the group. Its structure varies, but typically the group will enter into a limited partnership agreement with the professional investor who manages the fund. A sidecar fund, which is a separate fund that invests alongside the main syndicate, may also be part of the group.
Angel Syndicates for investors
If you’re an angel investor, you’ve probably thought about joining an angel syndicate.
Syndicate investing is a straightforward method for a group of investors to pool their resources to fund a specific startup or project. They frequently do so through a Special Purpose Vehicle (SPV), a type of micro-fund. The syndicate may be “led” by one or two investors.
How to be a part of Angel syndicates?
The requirements for membership in an angel syndicate vary depending on the angel group or organization, but some common factors to consider include:
Accreditation: Any angel syndicates require members to be accredited investors, which means that they meet certain financial criteria and are regarded as having a higher level of sophistication and ability to bear the risks of investments.
For example, if you want to be a member of AngelList, you must meet one of the following definitions to qualify as an Accredited Investor:
Individuals with annual income over $200K (individually) or $300K (with a spouse or spousal equivalent) in each of the last 2 years and an expectation of the same this year
Individuals with net assets over $1 million, excluding the primary residence (unless more is owed on the mortgage than the residence is worth)
An institution with over $5 million in assets, such as a venture fund or a trust
An entity made up entirely of accredited investors
SEC- and state-registered investment advisers
Exempt reporting advisers filing with the SEC
Individuals with certain professional certifications (Series 7, Series 65, and Series 82 licenses)
“Family offices” with over $5 million in assets under management and their “family clients,” as each term is defined under the Investment Advisers Act
Any entity with over $5 million in investments that were not formed for the specific purpose of investing in the securities offered
A rural business investment company (RBIC)
Nevertheless, the fact that each syndicate model would have a different requisition to choose their members. As put by the team at Investopedia, “An accredited investor is an individual or a business entity that is allowed to trade securities that may not be registered with financial authorities. They are entitled to this privileged access by satisfying at least one requirement regarding their income, net worth, asset size, governance status, or professional experience.
In the U.S., the term accredited investor is used by the Securities and Exchange Commission (SEC) under Regulation D to refer to investors who are financially sophisticated and have a reduced need for the protection provided by regulatory disclosure filings. Accredited investors include high-net-worth individuals (HNWIs), banks, insurance companies, brokers, and trusts.”
Experience and expertise: Many angel syndicates seek members with experience and expertise in specific industries or fields, such as technology, healthcare, or finance. This can contribute to the investment process by providing valuable insights and connections.
Investment history: Some angel syndicates may take into account an individual’s prior investment experience, including the types of investments made and their track record of successful investments.
Values and goals alignment: Many angel syndicates have specific values and goals that they seek to advance through their investments. They may seek members who share these values and goals, as well as those who are committed to using their investments to make a positive difference.
Network and connections: Some angel syndicates may take into account an individual’s network and connections in the startup and investment communities, as these can be valuable resources for identifying and evaluating potential investments.
Overall, the criteria for membership in an angel syndicate can vary greatly, and each group or organization may have its own distinct set of criteria and requirements. To ensure that you are a good fit for their community and investment philosophy, it is critical to research and understands the specific standards of each angel syndicate you are interested in joining.
How Angel Syndicates benefit investors
The ability to diversify your investment portfolio is the primary advantage of investing in an angel syndicate. You can spread your risk and potentially increase your chances of profit by investing in a group of companies.
Furthermore, investing in an angel syndicate can provide access to professional investors who have experience screening potential investments and providing guidance to the group. These professional investors can bring valuable knowledge, expertise, and experience to the table, helping you to make more informed investment decisions. By pooling resources and knowledge, angel syndicates can provide their members with a higher level of due diligence and analysis than individual investors would be able to do on their own.
Additionally, the group dynamic of an angel syndicate can encourage more robust and informed decision-making, helping to mitigate individual biases and enhance the overall investment process. This can assist you in making better decisions about where to invest your money.
On the other hand, as a member of an Angel Syndicate, you will be joining a community of people who share your interests, values, and goals. Most Syndicates encourage their Angels to interact and share ideas in order to foster a sense of community. There are numerous advantages to doing so, including the opportunity to meet interesting people, make new friends, and even find commercial and job opportunities.
The final one is to obtain the best Share Deal Flow and Due Diligence. Individuals working in groups can make much better decisions and solve problems more effectively than individuals working alone. Angel investors could even pool not only their deal flow, but also their knowledge, experience, and resources – their collective intelligence – through syndicate investing. They are able to source more opportunities and conduct extra informed due diligence on the startups they review by leveraging the collective intelligence of the entire angel syndicate. This improves deal selection.
Some drawbacks investors could consider
While there are many benefits to investing in an angel syndicate, there are also some disadvantages to consider, including:
Reduced control: When you invest as part of an angel syndicate, you give up a degree of control over your investment decisions. The group dynamic means that investment decisions are made collectively, which may not align with your individual investment goals or risk tolerance.
Limited liquidity: Angel investments are typically made in early-stage companies and startups, which means that they are illiquid and may take years to realize a return. This can make it difficult to access your funds in a timely manner, and you may need to be prepared to hold your investment for a longer period of time.
Risk: Investing in early-stage companies is inherently risky, and there is a high likelihood that you may lose some or all of your investment. By investing as part of an angel syndicate, you are spreading your risk across a range of investments, but this does not eliminate the risk associated with angel investing.
Complexity: The investment process for angel syndicates can be complex, involving due diligence, negotiations, and ongoing management of investments. This can be time-consuming and may require specialized knowledge and skills.
Cost: Angel syndicates may charge fees for their services, including management fees, transaction fees, and performance-based fees. These fees can add up and reduce the overall return on your investment.
It’s important to carefully consider both the benefits and disadvantages of angel syndicates before making an investment. It may be helpful to seek the advice of a financial advisor or investment professional to help you understand the risks and make informed investment decisions.
How to join Angel Syndicates
The application process for an angel syndicate may differ depending on the specific group or organization, but here are some general steps you can take:
Review the syndicate’s website: Start by reviewing the angel syndicate’s website to learn more about the group’s investment philosophy, values, and goals, as well as its membership criteria and requirements.
Prepare your information: Gather information about your background, experience, and investment history to include in your application. You may also need to provide information about your financial standing as an accredited investor if required.
Submit your application: Submit your application through the angel syndicate’s website or by contacting the group directly. Be sure to include all of the information requested in your application and provide a clear and concise explanation of your interest in becoming a member of the angel syndicate.
Follow up: After submitting your application, follow up with the angel syndicate to confirm that they have received your information and to inquire about the status of your application.
Attend an interview or information session: Some angel syndicates may require applicants to attend an interview or information session to discuss their investment experience and background, and to answer any questions about their interest in the group.
It’s critical to understand that applying to join an angel syndicate can take time and that the specific requirements and steps may differ from one group to the next.
For startups, equity financing comes in various shapes and sizes. The most common type is a traditional venture capital firm. However, there are other instruments and organizations that will fund startups in exchange for equity. A syndicate is a popular alternative to venture capital.
Today, we are going to show you the pros and cons of an angel syndicate platform. We hope you enjoy the post, and that if you are a founder or investor, you can use it to decide whether to join or not.
What is an Angel Syndicate?
We did explain in Angel Syndicates 101 that an angel syndicate is essentially a group of investors who agree to invest together in a specific project. A syndicate can be formed by angels or investees from any source; syndicates frequently include angels from more than one investment network. While no additional conditions are required, in order for the syndicate to be viable, all investors would typically reach a (non-legally binding) agreement on how the syndicate will operate.
In an angel syndicate platform, there has a professional who manages the network, screening potential investments and making recommendations to the group. Its structure varies, but typically the group will enter into a limited partnership agreement with the professional investor who manages the fund. A sidecar fund, a separate fund that invests alongside the main syndicate, may also be part of the group.
Angel Syndicates for Startups
An angel syndication network can be a great option for a startup looking for funding.
As a startup entrepreneur, you reliably understand that one of the most critical aspects of success is obtaining funding. While there are numerous options available, ranging from venture capitalists to crowdfunding, an angel syndication network is one you may have yet to consider.
As the words above, a group of angel investors who pool their resources to invest in startups is known as an angel syndication network. Therefore, this can be an excellent option for entrepreneurs seeking significant funding but unwilling to give up too much equity in their company.
To get the investment from an angel syndicate, startups should prepare not only their best model business, the expected products or services, but typically excellent pitching.
How an Angel Syndicate advantages your Startup
There are a few advantages when getting the fund from angel syndication networks:
First of all, they can give you access to a wider range of resources. Angels in a syndicate can come from dissimilar backgrounds and industries so they can provide valuable insights and advice.
Secondly, an angel syndication network can help you build relationships with potential investors. By working with a group of angels, you can get to know them better and build trust. This can make it easier to secure future funding from them.
Moreover, one of the most significant advantages of an angel syndication network is that it allows you to access more capital. When dealing with a single angel investor, they may only be able to invest a limited amount of money. However, by using a syndication network, you can access the resources of multiple investors at the same time. This can give your business the capital you need to scale up.
How an Angel Syndicatedisadvantages your startups
Of course, even getting a ton of benefits from this platform, founders still attend to some of its drawbacks. One is that you’ll need to pitch your startup to a variety of people altogether concurrently, which be harder to get their acceptance and you should prepare more carefully.
Another disadvantage is that you may have to share a larger equity stake in your company with a syndicate than if you worked with a single angel investor.
How to find Angel syndicates
You can find angel syndicates via the internet. There are numerous platforms that connect entrepreneurs with angel investors, such as the Angel Capital Association, the Angel Investment Network, and AngelList. Strong referrals may also help your case with angel investors, so consider tapping into the power of your social media connections, particularly on LinkedIn.
Conclusion
In conclusion, angel syndicates play an important role in the world of venture capital. By pooling their resources, angel investors can access a wider range of investment opportunities and provide startups with more significant amounts of funding. Angel syndicates also provide valuable support to startups, including mentorship, strategic advice, and access to networks and resources.
As the world continues to evolve and new business models and technologies emerge, angel syndicates will continue to play a critical role in helping startups grow and succeed. For entrepreneurs, forming partnerships with angel syndicates can provide a valuable source of funding, mentorship, and support to help them achieve their goals.
Every business needs funding, a point that’s especially true for startups. In the same words, choosing investment sources for your startup is such an important role. Because it could be a pointless and hopeless assignment unless you have the right and even deep knowledge. Only when you reach that, you would know how to play your business to appear in the proper places for the suitable type of funding and get your startup precisely wherein it needs to be.
If you are a startup looking for an investment to run your business, you may hear about Venture capital funds and Angel investors. However, there are not just only two kinds of fund sources for your business. In fact, besides VCs and Angel investors, a startup can receive investment from other manners. This post will help you understand more about what types of funding your startups need to know.
Bootstrapping
When your founders use their own money and assets to raise funds, it’s called bootstrapping. Bootstrapping describes a situation in which an entrepreneur starts a company with little capital, relying on money other than outside investments. An individual is said to be bootstrapping when they attempt to find and build a company from personal finances or the operating revenues of the new company.
Founders who choose this sort of startup investment accomplish that to save you 1/3 parties from gaining pursuits or stocks of their companies profits.
Crowdfunding
Crowdfunding is when raising the initial investments from the founder’s friends, family, individual investors, or even customers. In this new generation, the crowdfunding mechanism is typically done primarily using media and other funding platforms. With the rise of social media and other online crowdfunding platforms, entrepreneurs will have a single streamlined platform to showcase their business pitches to interested parties.
Crowdfunding is the way ahead for many people with an enterprise concept and little-to-no investment. Crowdfunding is a type of investment wherein non-public backers (individual traders) purchase your service or product earlier than it is to be had. This offers business proprietors an idea of the danger to fund their challenge in the alternative to supplying that services or products to their backers.
Loan
This method involves founders raising capital through borrowing cash. Loans are the most commonly used source of funding for small and medium-sized businesses. Consider the fact that all lenders offer different advantages, whether it’s personalized service or customized repayment. It’s a good idea to shop around and find the lender that meets your specific needs. There are two major types of this fundraising method:
Small business loans: rising businesses avail as they have lower interest rates. Small business loans are similar to personal loans, meaning you’re approved for a set amount of funding with an interest rate attached.
Asset loans: This debt funding raises higher capital than small business loans by borrowing cash against collateral. The said collateral can be the founder’s asset or the assets of someone involved in the business.
Incubators and Accelerators
For founders, this type of investor can be their gateway to the other investors in this list. Incubators focus more on helping startups or individual entrepreneurs in refining their ideas and establish their business plans. They also help founders work on their product and service market fitness and identify possible issues.
Meanwhile, the function of accelerators is to help startups hasten their development. They may provide a set timeframe to mentor and fund startups. Both accelerators and incubators aim to speed your startup company to the next stage.
Angel Investors
An angel investor (private investor or seed funder) is a high-net-worth individual, who invests their own money into startups. They mostly fund into an early-stage (seed stage) business when the company exists only as an idea or perhaps when the running up is initially in place.
Apparently, this is the most important phase of a new business to survive in the market, and faces a bunch of challenges. The fundings help startups grow and sustain in the critical stage of development until the companies require more sizable investments from venture capital firms for the next stages. As the name of angel investors, they might not be mainly on profit like a venture capitalist but could invest to exchange the ownership equity or convertible debt.
However, some seed funders pour their money into a startup merely to supply the finances that push the company’s development. Because of the comprehension of the founders who need to hold the highest stake to encourage their companies to succeed, angel investors don’t usually acquire more than a 25% stake in the company. Furthermore, the business owners will not be required to repay if the companies go belly up.
Venture capitalists
Venture Capitalists are the most well-known with startups in early-stage fundraising. Unlike an angel investor, a venture capitalist pools funds from other investors called a limited partner (LP), and perhaps, in addition, their own money. They can write larger checks than angel investors, which could reach 100 million dollars for the company.
Indeed, venture capital basically invests in new businesses with breakthrough ideas with high potential for growth and advancing social progress in the long term, but coevally containing a substantial amount of risk enough to scare off banks to fund.
However, as the above saying, even venture capitalists are gamblers who could hazard into very new ideas, they usually don’t want to jump into the idea stage because of the risk and lack of conviction. In this case, venture capitalists tend to wait until getting a proof of concept in hand, then do due diligence before deciding to invest. Metaphorically, they are the high experts at hunting a ‘unicorn’ among a herd of horses.
