Why the laziest angels are the cleverest

You can’t move for start ups nowadays and I’ve noticed a strange phenomenon…..

Angel Fatigue.

It’s everywhere.

Why?

Because it’s incompatible with the most precious resource in the world — Time.

Take a look at the ‘retirement posts’ of big dog angels — Tucker Max, Tim Ferris, even Doug Scott (haha). The ‘time suck’ is the record that replays.

Of course some angels love being ‘in the trenches’, but most I know are operators who like doing other things. And it’s becoming impossible to find the “signal in the noise”.

So where next?

Angels can’t do less deals because the first rule of angel investing is ‘do loads’ and this means 50-100 deals. See here, the chart below or anything by Dave Maclure to see how ‘the more you do = higher probability of returns.’

And, by the way, this is massively counter-intuitive to most people’s ‘stock picking’ egos.

RSCM research https://possibleinsight.com/2010/05/11/simulating-angel-investment-kevins-remix/

The rise of the angel index

We live in the age of the index.

Everyone laughed at Vanguard once but indexing is the stock market today. The game of buying the market, lowering your fees, and getting market returns (which 96% of fund manager don’t) is well established.

Will this happen to angel world?

It seems pretty inevitable that some form of low fee index will be the clever ‘angel play’

More and more start up data, more people collecting it, harder to ‘pick winners’ due to sheer competition.

Personally I can see a world where you have large cap, small cap, micro cap and angel cap. Its a world to ‘go long’ the Angel Lists of the world who look like they’re only just getting started — https://angel.co/access-fund/fund

No time. Low Fees. High growth. ‘Market’ Returns

The laziest angels will be the cleverest.

VC Partner@SAATCHiNVEST. Seed investor in Citymapper, Farewill, Ometria + more. Chief of Staff@Redbrain. NED@Picassolabs. Founder Linkybrains.com

VC Partner@SAATCHiNVEST. Seed investor in Citymapper, Farewill, Ometria + more. Chief of Staff@Redbrain. NED@Picassolabs. Founder Linkybrains.com