

Brief Thoughts on Angel List - ericflo
http://500hats.typepad.com/500blogs/2011/02/brief-thoughts-on-angel-list.html

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podman
I'm not really sure how Angel List works. I listed my startup a couple of
weeks ago and it's had just 3 views. We don't have any "Social Proof" since we
have been bootstrapping to this point. It feels as though Angel List has no
utility unless you already have taken some money or a have a well known
advisor. I also have not listed Price & Terms, which I have a feeling is also
hurting the profile, as I'm not yet sure how much I should be raising and
would like to discuss that with a potential investor first. So, if I have no
"Social Proof", how likely are investors to find my company's profile on Angel
List?

Edit: I guess there is also the possibility that my company will not be the
next Facebook nor does it even aspire to be and because of that, I guess it
might not be interesting to investors.

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davemc500hats
best way to start on angel list is: 1) get at least one notable angel to
introduce it / submit it 2) ideally have them introduce you to a few others
(privately) 3) once you have some visibility / traction with a few folks, then
set your listing public and open it up to the rest (if you want)

this should probably be a separate thread here or on Quora to discuss best
techniques for marketing a deal on Angel List. i'll try and write a blog post
on this or a Quora question in the future. it's worth diving into more.

~~~
podman
That does make sense, and if that is the way it works, that's the way it
works. The name AngelList, at least from an entrepreneur's stand point, might
be misleading then. It seems to me that AngelList is more of a list of
potential start-ups for angels than it is a list of potential angels for
start-ups. While it can be used either way, to me it seems that the benefit is
more for the angel than the start-up looking for funding. Maybe it should be
called StartupList?

~~~
webwright
It worked this way long before angellist. You need some combination of amazing
team, traction, or social proof. AngelList features a huge bunch of angels
which is a HUGE benefit to the startup. Finding angels is hard. But just
because they are all in one "room" doesn't mean that you don't have to impress
them in the same way that startups have always needed to impress.

The good news is that once you DO get get something eye-popping (an amazing
prototype, a great advisor, a brilliant growth curve), AngelList can be like
gasoline on a match-- you close faster and with better terms (at least that's
what I've heard from multiple sources).

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damoncali
Dave strikes me as rude, obnoxious, and difficult to read. But more
importantly, he strikes me as correct. The vast majority of VC's do a terrible
job at investing. He's bold enough to try a new way - the index fund of the
startup world.

As they say, those who say it can't be done shouldn't interrupt those who are
doing it.

Who knows if it will work, but I'm eager to see the results.

Edit: when I say Dave, I mean his writing style - I've never met the guy.

~~~
tansey
I think I may be the only person on HN (besides Dave himself) who actually
enjoys his writing style. Then again, I grew up on the East coast playing
poker and basketball everyday, so smack talk is second nature to me.

Most people in the Bay Area seem to be in a competition to see who can be the
most modest, which has never been my style.

~~~
epi0Bauqu
I like it too (east coast as well). I just see it as straightforward, though
I've also been accused of having an offensive or off-putting tone when I
thought I was being straightforward as well.

~~~
loganfrederick
I don't see it as straightforward. I agree with a lot of what he says, but
trash talk of pretty much any kind tends to distract of the issue at hand.

Like in sports or gaming, I always prefer the person who plays silently and
speaks with purpose than someone who tends to trash talk while playing. But
neither form of etiquette effects who is the better player.

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StavrosK
Oh wow, I'd describe that writing style as "stream of semi-consciousness". I
couldn't read all of it.

~~~
rararational
I would describe his entire writing style as annoying and abrasive which makes
it so I can read barely any of it. But I suppose some people like it or the
ideas as his writings seem to do well here.

~~~
davemc500hats
that is my writing style. i was also in a hurry because i needed to get my kid
to basketball practice at 10am, and i started at 7am.

usually it takes me about 5-6 hours to include the "full insanity" version
with fonts, pictures, etc.

(anyway, i'm obviously an acquired taste... i won't be offended if you think
i'm offensive.)

~~~
rararational
I've never met you so I can't possibly think you are offensive but I do find
your writing style a bit harsh to read, some people obviously like it though.

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pedalpete
Dave makes it pretty clear that though VC's years ago praised the theories of
the Wisdom of Crowds, they felt it applied to other industries, and not
theirs.

Seems most 'experts' feel that way.

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jorkos
Dave nails the often unspoken truth: traditional VC's have been terrible on
average. Suspect the savvy LPs will pour more and more into 500hat-esque
vehicles...

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dirtyaura
Dave is spot on when he says that "value-added" investing comes more and more
from domain experts. We have lately had discussion with a few investors. The
quality of feedback AND connections from those that have been hands-on
entrepreneurs, especially in our field (gaming) is in a totally different
level compared to others.

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MortenK
I wonder when this Silicon valley school yard soap opera is finally over.

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adsahay
Just in time for my compilation (bit.ly bundle) of interesting reads in tech
controversies: <http://bit.ly/openletters>

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ashbrahma
Reading him is like reading James Joyce Finnegans Wake. For those who haven't
read the book: <http://en.wikipedia.org/wiki/Finnegans_Wake>

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hexis
This blog seems like a parody of western civilization.

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acgourley
I don't like how he points at the negative 10 year VC return numbers as
implied proof his strategy is superior. On the other hand I don't know why I'm
arguing against someones alter ego.

~~~
MediaSquirrel
I think he's acknowledging that there is still risk in his strategy, but
that's it's not as risky as critics like to say.

~~~
acgourley
That's overly charitable of you. Why would he bring up the last 10 years of VC
returns unless his argument was, "look how bad traditional investor schools of
thought are, anything else that kinda seems to make sense must be as good or
better". But that doesn't follow.

The past 10 years returns of VC's investment strategy says nothing about his
strategies relative performance.

~~~
davemc500hats
i didn't say "anything else must be as good or better".

what i meant was that blind trust in traditional VC strategy doesn't make any
sense, since on average they suck.

my strategy is still new (<12 months old), so there's no historical
performance to compare, outside my investing at Founders Fund (which looks
pretty good so far) and my own angel investing (which also looks pretty good).

sorry i can't share #'s here on those, but as a personal investor i was in
early on Mint, SlideShare, Simply Hired, & Mashery. as a professional investor
at Founders Fund i was in early on Twilio, CrowdFlower, CreditKarma, Bitly,
and several others which are doing pretty well.

still, it's too early to say whether i'm any good or not.

my point was simply that arguing status quo doesn't make sense when status quo
is sucking pretty hard.

~~~
acgourley
Look, I like your investment strategy and want to see how it plays out.

That said, your post does imply that the weak returns of the VCs last decade
lend your approach merit when you point out their weak returns and then say:

"to be more specific: if we look at the #'s, on average it's more likely that
high-volume, spray & pray investing -- which i will going forward refer to as
"a quantitative investment strategy" -- is likely to be successful than a
"focused, low-volume" investing strategy."

(Of course I assume you measure success by expected value, not the chance of
being in the black after a small number of investments)

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davemc500hats
yeah, guess i'm intentionally taking on the "spray & pray" haters, but to me
more specific -- i'm combining that strategy with other filters, domain-
specific expertise, selective follow-on investment. the combination of all of
these is more like an index fund for initial selection, then active management
and time-weighted averaging of future funds into the winners.

little bit complex to describe, adn we're still developing it so even i'm not
final on which parts add most value.

but we are trying some new shit. some of it hopefully works ;)

~~~
bmelton
One has to believe that with the variety of startups coming out that seed-
level spray and pray, coupled with selective follow-on will likely get you in
on big things.

Worst case, you have an existing relationship with a large number of startups,
a percentage of which will undoubtedly go on to bigger things or exits -- the
trick is of course in how big that percentage is.

This is evidenced somewhat by the increasingly large number of teams getting
accepted by YC.

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clark-kent
I appreciate the entertainment, investing would have been so boring.

"Angel List is like Dangerous Sex with Super Models for Virgin Nerds.

yeah that's it -- imagine if you're Urkel and all of a sudden you get to find
out who the newest Sports Illustrated hotties are, who they're screwing, and
then SOMEHOW you discover an opportunity to SCREW THEM YOURSELF TOO! (omg,
where do i sign?!?) ok, so you get the picture. this is probably why Bryce
left the party."

~~~
clark-kent
The above quote is direct from the blog post. Not my words.

