NACO is proud to present NACO Academy Publication A Practical Guide to Angel Investing: How to Achieve Good Returns (Second Edition). This guidebook is a must-read for new angel investors, experienced angel investors, and entrepreneurs seeking angel financing.
Dedication | 6 |
Preface | 7 |
Helping Clients Thrive and Communities Prosper | 9 |
Guide to This Book | 10 |
Welcome to the World of Angel Investing | 12 |
Who Are Angels and Why? | 13 |
How Do Angels Invest? | 16 |
The Role of Angel Investing in the Economy | 19 |
Our Investment Ecosystem | 22 |
Chapter 1 - Set Good Targets | 23 |
1.1 Personal Motivation for Angel Investing | 24 |
1.2 Personal Capital Budget Available to Invest | 26 |
1.3 Portfolio Targets | 27 |
1.4 Value Investing vs Momentum Investing | 30 |
1.5 Co-Investing With Other Angels and Angel Groups | 31 |
1.6 Personal Education Goals | 34 |
Chapter 2 - Find Good Companies | 37 |
2.1 Sources of Deals | 38 |
2.2 Screening Opportunities | 42 |
2.3 Managing Deal Flow | 47 |
2.4 Using an Angel Fund to Augment Your Individual Investment Portfolio | 47 |
Chapter 3 - Pick Good Companies | 55 |
3.1 The Due Diligence and Deal Negotiation Process | 57 |
3.2 Hygiene vs Insight | 59 |
3.3 Analysis Lenses for Gaining Insight | 60 |
3.3.1 People - The Team: Human Capital, Intellectual Capital, and Social Capital | 60 |
3.3.2 Lean Startup and Getting to Plan B | 62 |
3.3.3 Business Model Canvas and Lean Canvas | 64 |
3.3.4 Strategic Lenses | 66 |
Chapter 4 - Make Good Deals | 69 |
4.1 Negotiation Fundamentals | 72 |
4.2 Deal Structure | 73 |
4.3 Valuation | 75 |
4.4 Term Sheet Conditions | 80 |
4.5 Deal Syndication | 81 |
4.6 Signing the Deal - Legal Stuff | 82 |
Chapter 5 - Grow Good Companies | 85 |
5.1 Governance and Coaching/Mentoring | 87 |
5.2 Metrics | 88 |
5.3 Money | 89 |
5.4 Networking | 92 |
Chapter 6 - Create Good Exits | 93 |
6.1 Early-Exit Acquisition | 98 |
6.2 Large Acquisition or Successful IPO | 99 |
6.3 Secondary Offering, Dividend, Royalty, or Buy-Back | 101 |
6.4 Fast Fail, Expensive Fail, and Zombies | 102 |
Concluding Thoughts | 103 |
A Word From Our Partners | 104 |
Appendix | 105 |
References | 106 |
Glossary of Terms | 110 |
Experts Who Reviewed This Book and Contributed Content | 126 |
Angels and Angel Experts Who Were Interviewed for This Book | 128 |
About NACO | 129 |
NACO Academy Modules | 130 |
NACO Online Sample Documents | 131 |
Acknowledgements | 131 |
Author’s Bio | 132 |
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