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Angel investing is hot.  I recently went to the Angel Capital Association (ACA) Summit in Chicago.  The general purpose of the ACA is to foster angel investing throughout the U.S.

Angel group leaders and members from across the nation attended a 3 day conference in downtown Chicago.  Topics ranged from angel group management to the latest deal terms.

If you're an angel investor, I highly recommend getting involved with a group.  It you're an entrepreneur, presenting to your local angel group is a great way to get feedback on your company or idea from qualified investors.  You might even win their investment.

Don Jones

www.VentureDeal.com

I thought it would be helpful to subscribers of VentureDeal for me to include blog entries from time to time on the subject of how to get the most out of the VentureDeal database.

This entry is about using the Search function.  Within VentureDeal, there are four different searches that can be performed:  Transactions, Venture Investors, Technology Companies and Service Firms.

Based on your choice of search type, the system then presents a number of criteria options to choose from.  It defaults to the "Basic" option, but in many cases you may select "Advanced Options" to add more criteria to really focus your search.

The main point is that the more criteria you choose, the tighter your search results will be, since each criterion restricts the search parameters.  If you aren't seeing the results you expected, try reducing the number of criteria you selected, for a broader search result.

Don Jones

www.VentureDeal.com

An important part of angel investing is doing due diligence.  It isn't exactly fun or exciting, but is absolutely necessary.  One of the benefits of being in an organized angel group is the ability to divide up the due diligence efforts among the interested members. 

This usually results in better information because each member has more time to devote to his or her specific area.  Additionally, a smart group will assign the more technical angels to delve into the product or service details, and the less technical members to focus on the business issues.  Having more "eyes" on the company also results in more perspectives and healthy debate on its future prospects.

Working in a group is never perfect, but working together to determine whether an investment makes sense is usually the best course.

Don Jones

www.VentureDeal.com

One mistake that start ups make is that they are inconsistent with their marketing messaging, even after a creating a formally agreed upon strategy.

Start ups are constantly being pulled in numerous directions.  The world is their oyster and they usually want to get customers any way they can.  The temptation to change the message to suit previously unidentified customer types is strong.  Even if they get the messaging right, it can still lead to confusion in the marketplace, since it is impossible to "silo" messaging entirely.  It always spills over.

The result is that potential partners, customers and other market participants cannot identify with the new language, which may not be "their" language.  So it doesn't stick.

It's very difficult to build market momentum this way, or to "own" a market segment.  In my opinion, it is far better to focus on dominating a single market than to get sidetracked by a diluted message.

Don Jones

www.VentureDeal.com

One marketing mistake that start ups make is refusing to create a formally agreed upon market- and customer-focused positioning strategy.

It is tempting to want to wing it, to assume that you're going to improvise or "adjust" as you go along.  It may be true, but getting a full positioning strategy (e.g., market and product category, segmentation, segment problem, competitive differentiation) is absolutely necessary.

The reason is that you are going to measure results against it.  How can you measure results against something that doesn't exist?  Measuring results will then tell you how well you are doing against your assumptions and where you need to make changes.

You will inevitably need to make changes, which you will then modify your already written positioning strategy in the direction you need, and the process of measuring results against the new positioning strategy will begin again.

Don Jones

www.VentureDeal.com

I recently came across an interesting resource for angel investors and entrepreneurs, whether novice or experienced:  The Angel Journal.

Published by veteran journalist Kemila Velan, The Angel Journal is a semi-monthly email and companion website that provides a wealth of information that is helpful to angel investors looking for investing tips as well as entrepreneurs looking for funding search insights.

The publication provides well-written articles by experienced, nationally- recognized angels, themed issues such as the current month's focus on Social Investing and some of the latest angel venture funding transactions across North America.

Check it out...The Angel Journal

Don Jones

www.VentureDeal.com

I've seen a lot of entrepreneur presentations at the very early stage - people looking for seed money or series A rounds.   I'm amazed by some of the things I hear.

For example, lately I've been hearing that to invest in an entrepreneur's company would be like investing "in the next Google."

When I hear that, I immediately laugh (internally) and I write off the idea of ever investing in the company.  Perhaps the entrepreneur has learned from some funding search coach that they have to "sell the sizzle" in order to get angels to invest.  Maybe they really believe it.  Who knows.  Experienced, seasoned investors don't believe the hype for a second.  Those who invest at the very early stage invest mostly in the entrepreneur's ability to make something good happen, adjust to the realities of the marketplace and the inevitable setbacks.

So here's a tip to entrepreneurs raising capital:  Convince investors why they should invest in you first and your idea second.

Don Jones

www.VentureDeal.com