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Wednesday, August 22, 2012

Hacking Angel List - The Tel Aviv Angle

A lot was written about Angel List. Some say that its the biggest thing in venture capital since Y-combinator. Others might claim that its just an automated mailing list for executive summaries or that its flowed in the sense that it only helps startups that already closed a lead investor which is the hardest part anyway. Here in the startup nation - Angel List is relatively new so I wanted to give the local angle.

If you haven't heard about it yet, angel list (www.angel.co) is a social network for angels and entrepreneurs. It allows individuals to set up a profile a bit like linkedin but it also allows you to set up a profile for your venture like it would have in crunchbase. This combination, alongside privacy features that allows exposing more sensitive information only to selected investors creates a good vehicle for discovery of funding/investment opportunities.

While Angel List has become very successful in the U.S. in Israel it is still racing for critical mass. One might think that the world of funding has evolved beyond location but that is simply not true (ill address that in a different post). Nonetheless, there is still a lot of value in Angel List for Tel Aviv based startups as long as the right approach is taken. The right way for a local entrepreneur to use angel.co is as a refernece tool rather than discovery tool. Think about the way you are using Linkedin to check up on people before or after a meeting and picture that at least some of your investors are doing the same before setting up a meeting with you.

Here are some points that are specifically applicable for Israeli companies trying to leverage Angel List:


  1. As indicated by many others but most recently in a keynote by Naval Ravikant called the Anatomy of unfundable startup, the three most important things for a startup to get funded are: traction, team and product. These are things that are hard to communicate in a 20 minute pitch and Angel List provides some tools for communicating those. Your startup profile should focus on these three.

  2. Social Proof - this is one of the best recommendations I can give. Regardless of Angel List, you should validate the story with many industry experts, seasoned entreprenuers and potential customers. Any time you get a "wow, this is a good product/story/company" - try to get them to vouche for you. Early stage investments are very risky and investors like to think they are not the only crazy ones. In addition, validating your story tells a lot about you.

  3. While it's unlikely that investors will discover your Tel Aviv based venture via Angel List, Israel is such a small place that it's very possible you will discover that the next door neighbor or your tent mate from the army is in fact an investor.

  4. The Investor dream team - Discover investors who can really move your startup forward and mentally assemble your dream team. You may not get them all but it will help you focus your energy. It will also help you get intros if you clearly state that there is a fit between the investor background and your startup market as opposed to just saying you are looking for money.

  5. Applying pressure to close a round - many investors tend to stall investment unless they have a good reason to move quickly. There is nothing like competition to get an investor moving and Angel List can help you put leverage on that slow investor.

While writing these lines - The SOOMLA Project is leading the Israel charts on Angel list for the 3rd week in a row. Special thanks to everyone who vouched for us.




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