1/ “How do I start angel investing?"

Someone recently asked me this & I thought I would tweet my answer.

3 main reasons to invest:
1. For fun+learning
2. To make money
3. To become a VC

For this thread, I will assume it's mostly for reason 1 (fun+learning.).

2/ Step 1 is having money.

Most companies have a $5k-10k investment minimum & you need to commit to investing in >20 companies over a few years to really learn.

You also need to be accredited (though you can somewhat “hack” that by having equity in a startup worth $1m.).

3/ Step 2 is to learn the basics about investing. Most investments in US startups is done with a SAFEs now days.

Y Combinator has a good explanation of these and you can just read the SAFE—it's not long: www.ycombinator.com/documents/

Another great resource: learn.angellist.com/angel-investing

4/ Step 3 is to learn how to judge startups.

I tweeted about my thoughts on judging startups:

5/ Step 4 is to expose yourself to as many seed “deals” as possible. Learn what "good" looks like.

A few sources for deals:
- Mercury Raise: mercury.com/raise
- AngelList syndicates (sign up as a LP backer)
- Y Combinator batches
- Your founder & investor friends deal flow

6/ Step 5 is to start emailing founders that are raising money & invest!

Its easy to get excited at the start so have some discipline: invest ~once a month max, backing—at most—50% of the founders you talk to.

8/ One final tip: to get your network of investors to introduce you to deals, make sure you introduce them to them to companies you invest in.

You can also meet new investors by emailing those that invest in the companies you invest in. It all becomes a somewhat virtuous cycle!

7/ Starting is the hardest part.

Once active, investors and portfolio company founders will likely introduce you to new companies, and your deal flow will improve.

Founders are also most likely to let you invest when you have a good+relevant portfolio behind you.

Good luck!