Purposeful Networking: 3 Lessons I Learned from Founding an Angel Group
I’ve been involved with angel investing since before the .com bubble burst, and I believe more strongly than ever in this asset class, which is the most prolific early-stage investment class in North America.
As a founding board member of the Angel Capital Association (ACA)—a collective of accredited angels investors—I’ve had the good fortune to get to know and professionally engage with angels from nearly every state.
Those relationships really solidified for me when back in 2009. At the time, I was working in a region that didn’t have an angel group—so we decided to start one.
And, yes, as you are probably thinking, our timing wasn’t the best.
And that takes me to the lessons that were reinforced for me in founding that angel group.
“If the world were perfect it wouldn’t be.”
I’m borrowing that quote from the great Yogi Berra. It’s a reminder that there’s no such thing as “perfect timing—especially in the warp-speed world of startups. If we let that belief influence our plans, we’ll miss windows of opportunity.
In 2009, the country was staggering from the worst recession in seven decades. Unemployment was over 10 percent, the highest in 26 years. The Dow bottomed out at below 6500 (off its all-time high of 14,164 in 2007)—the lowest in 12 years.
The value of all US stocks had dropped from a peak of $22 trillion to $9 trillion—a gut-wrenching loss of wealth to exactly the demographic that we sought to engage with our plans for a new angel group.
We were founding that angel group in Oklahoma, an area of the country that didn’t have venture capital or much at all in the way of defined private sources seed stage capital.
The idea of an angel group was new, even to supporters.
But we did it.
In the midst of all the economic chaos and uncertainty, in a region where people didn’t know a lot about angel investing as an asset class, we were able to connect with accredited investors and community leaders who recognized that almost all net new job creation comes from young companies.
We met with entrepreneurs who had successfully built wealth from taking risk who wanted to participate in interesting new deals. Today, that angel group that we founded back in the dark days of 2009 has 50-plus angels and more than $7.5 million invested.
Successful people don’t do it alone.
Thinking back to when I was starting my career, I didn’t even know what networking meant. I had never been exposed to it in engineering school. I just started meeting people.
One of those was a mentor who helped me develop my comfort level to build purposeful relationships. Today, I’m part of this tangled web of relationships—tangled in the very best sense—that is based on benefit for everyone.
In founding SeedStep Angels, we interconnected with all sorts of folks, starting with experienced angels from other parts of the country, including some from here in Columbus. They were a terrific source of best practices. Collaborative and generous in sharing what they had learned when they started their own angel groups, they helped us avoid pitfalls and get on our feet in just a few months.
Never lose the networking mindset.
Whether you are starting a company, and investment fund, or an angel group, it’s essential to have different forms of networking and to make those connections for the right reasons.
A reasonable goal for anyone in business is to make two new purposeful connections every week.
As investment fund managers here at Rev 1, we’re always thinking about other potential investors who might share common goals with Rev1. We’re also always thinking about we can use our connections (professional or personal) to help the startups that we are working with.
Here at Rev1, we’ve taken purposeful networking to new heights. The team has built an advisor network of more than 100 strategic advisors and industry experts.
These folks have logged more than 800 pro bono hours giving advice and mentoring. They are people who like and have faith in entrepreneurs and want to give back.
Even when times aren’t perfect—and of course they never are—these advisors stand ready to go to bat for our region’s entrepreneurs.
Let’s play ball!
*Source: Angel Capital Association