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Challenges in Angel Investing

Challenges in Angel Investing

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    The Importance of Diversity in Your Portfolio

    1 min read According to a Harvard Business Review study on increasing diversity in venture capital partnerships, the more similar the backgrounds shared by the investment partners, the lower the investment performance. Diversity, simply put, leads to better performing teams. Diversity of perspective breeds a startup that has a better understanding of the pain points that they’re trying to solve. The more a startup ensures that its team includes both women and minorities, the more likely it is to uncover the solution to the problem it set out to solve, and the more likely it is to yield a high performance. However, the fact remains that minority and women-owned businesses still struggle with funding when compared to their white, male, counterparts. While the investment space is working to shift this imbalance, the work is far from over and many still face an uphill battle toward equality. Minorities and women continue to face both structural barriers and biases when it comes to career paths. These individuals are expected to fit within a certain mold and stay within that mold. For example, less than 30% of the CEOs within the US are women. Statistically, however, there are more women in the US than men at roughly 97 men to 100 women. As Ola Gambari, COO of Hungry Fan explains: “It’s the idea of this preconceived notion that we have a lane, and we’re supposed to stay in it and, as a minority, if I’m not running a business focused on minority problems, I shouldn’t be running that business, neglecting the fact that I share all of the other pain points of other human beings in this society.” Instead, investors should be evaluating the business on its merits, not just the fact that it has minority founders. Again, it breaks down to recognizing that different perspectives matter and yield better results. As more investors embrace this knowledge, the more equality we’ll begin to see. Read more: https://staging.startupfundingespresso.com/education Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    Building your Entrepreneur Ecosystem

    2 min read Building your Entrepreneur Ecosystem Your Checklist on how to build an Entrepreneur Ecosystem in your Area   Startups need networking, mentoring, and funding. A robust entrepreneur ecosystem fosters connections between the startup and a network of providers, mentors, and investors. Each type of startup: high-growth, tech, consumer product-related, healthcare, etc., will need a unique set of networks (people to hire and contract), mentorship (people who can guide and coach the startup), and funding (people who can invest in the business).   The following are a series of steps you can take to build a solid Entrepreneur Ecosystem in your area. Step #1: Map the Startups in Your Area The first step to growing your startup community is to identify the startups in your area. Start by mapping the location of each company. Then, you’ll want to capture the type of company, location, and stage of growth, categorize them by sector (healthcare, tech, consumer product goods), and then subcategorize by stage (seed, early-stage startup, late-stage startup). Having a solid list will give you a great place to start. Step #2: Map the Existing Startup Resources in Your Area The second step is to identify the startup resources in your area. Build a list of groups, organizations, funds, and other accessible resources, and then categorize each by offering (networking, mentoring, funding) and subcategorize by stage (seed, early-stage startup, late-stage startup).   Step #3: Choose the Type of Startup You Can Support Next, you’ll want to choose your entrepreneur type to support and be intentional about it. Understand the type of network they need, the type of mentorship they require, and, importantly, the kind of funding they need.   Step #4: Identify the Gaps in Resources The fourth step to growing your startup community is identifying the gaps between the resources needed and those available.  Identify the missing network, mentorship, and funding resources in the area.   Step #5: Recruit the Resources to Fill the Gaps Once you have identified the gaps, it’s time to recruit the resources to fill the gaps.   Step #6: Setup a networking platform to facilitate the connections The last step to growing your startup community is setting up a networking platform to facilitate the connections Recruit network resources. Having a platform will connect startups to providers, suppliers, customers, etc. It can also connect startups to advisors, mentors, and coaches through pitch sessions, online portals, and much more. Read more: https://staging.startupfundingespresso.com/education Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    The Challenges of Investing in the Impact Space

    1min read When it comes to impact investing, the truth is this: It’s harder to invest in the impact space than in the traditional venture space.  That is not to say that the traditional venture space isn’t hard. Of course, investing in the venture space is quite tricky on its own. However, impact investing holds a set of challenges unique to its sector. One thing that new investors interested in impact should keep in mind is that these are investments that take time. It is not uncommon to wind up making an investment and holding on to it for 5-8 years, on average. Fundamentally, impact investing is not for the faint of heart. It requires a tremendous amount of focus, and you should only be investing in areas where you think you can affect the outcome. Otherwise, the time you spend with it may not be worth it. It’s also essential to take your time and ensure that you’ve put in the work to make the entrepreneur and first five people of the team resilient individuals. After all, they are likely in it for the long haul, too, and it all comes down to emotional resilience. Make sure that the team has figured out how to take care of themselves through the process of starting a company. Many times, these early-stage entrepreneurs offer a lot of opportunities to investors, but if the individual hasn’t spent time on him or herself, there’s going to end up being corners that get cut. It is at this stage investors begin to see some of the messiness, especially the ethical hang-ups that can happen with new companies. There are a lot of opportunities around the world to open up markets for these individuals, but you have to make sure that they are well prepared for the ride. Read more: https://staging.startupfundingespresso.com/education Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    New Investor Risks

    1 min read As a new investor, entering into the world of investing can be an exciting time. Opportunities can seem limitless, and they are, especially as the world’s talent pool continues to expand in ways we’ve never seen before. When you’re just getting into the game, there are a couple of steps you can take to increase your chances of success. The first thing you should remember is: Networks are a priceless resource for countless reasons, especially for a new investor. One of the main advantages of a robust Network is having a place to ask questions. The more questions you can ask, the better. When you’re just starting out, you’re going to spend some time in a learning phase. Take this time to soak up all of the information you can; a good network will make all of that information available to you. All you have to do is ask and be open to learning. Another vital thing to keep in mind at the very beginning is: Don’t get overexcited. You might find a few companies with a solid pitch and great founders. The founders are excited, so you get excited, too. Inevitably, new investors who are too eager will write a check to startups who will, as most do, close their doors. This outcome is simply the nature of the space. A number of the startups you invest in will fail because, no matter how much you want them to be a winner, the startup world is a numbers game. Often, this leads to frustration, and many investors choose not to re-engage in the investment world because they feel they’ve “been burned.” However, you can minimize the potential risk. Instead of getting caught up in the excitement, try to take the first 6-12 months to familiarize yourself with the ecosystem. Ask a lot of questions and then write your first check. Continue to learn and ask questions along the way. Focus on building your portfolio slowly and with the correct education. In the end, this will help reduce the risk of failure. Read more: https://staging.startupfundingespresso.com/education Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    Space Tech: The New Investment Frontier

    1 min read For the first time in human history, 2020 has seen the launch of a commercial rocket carrying passengers into space. This would have been considered “science fiction” not long ago. Today, space tech is a lot less “fiction” and a lot more science. Even more importantly, investors are taking notice. The space tech and exploration sectors have seen an explosion of activity in recent years. Investors are flocking to startups that want to be on the cutting edge of a new era. Many investors now see countless opportunities in space colonization because it is no longer a matter of “if”, but “when.” Leaders like Elon Musk are pushing humans toward the next step of exploring the stars. This drive has created an ecosystem that dozens of companies are being built to support. We’re even seeing plans to build out hotels in space. One example is a company called Axiom. They provide crew missions aboard the International Space Station today, while building the commercial space station of tomorrow. Axiom will be the first private company to take control of building out the new international space station, something NASA typically controls. That said, with every new venture comes challenges. One thing investors have pointed out is that the next hurdle for commercial space travel is going to be building out a true communications infrastructure that safely allows for and regulates the ability of space travelers to communicate with each other and with those back on earth. As SpaceX has shown us, however, we are ready to leap out into this new frontier and explore the new opportunities awaiting us. Read more in our latest eGuide: https://staging.startupfundingespresso.com/education/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    Your Data Room: What it is, and How to Build One

    A data room, sometimes referred to as a “due diligence box,” is a cloud solution made for the sharing and securing of sensitive business information. A data room should not be confused with a simple cloud storing service. When handling confidential information, you’ll need features such as rights management and Q&A. The goal here is to maximize your fundraising potential by being organized and demonstrating that you respect the investor’s time by being prepared. Having a well-organized folder is also an opportunity to show investors that you have a real business and are ready to raise capital. This data room contains vital documents about your business and is incredibly useful to your potential investors, so it’s essential to keep it both functional and secure. The materials in your data room should include:  Entity filings Patent filings Articles of incorporation Income statements Balance sheet Other documents detailing your business  Investors who want to invest will look for these documents so they can run their due diligence on you and your business. The more simplified you can make this process for them, the better. Spend some time putting your data room together and make sure you have all the necessary documents for your investors. Most importantly, be prepared and have these documents ready before you begin your raise. Continue reading in our most recent eGuide: How to Prepare for Your Fundraise   Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group  

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    Investing in Cannabis: Understanding the Cannabis Industry as an Investor

    The cannabis industry has become a nest of investment opportunities. However, investing in cannabis differs from other sectors in a lot of ways. One of the main things that sets this space apart is the fact that it is still in its creation phase. Cannabusiness is an actively developing space. With that comes no historicals to reference; no previous data on which to base investments. For investors to enter this space, there must be an effort to dig in and figure out a way to it. It’s about understanding the industry on a ground-up basis because the information flow and data sets are limited. You have to live in it, to be a part of it genuinely. Part-time investors beware: it’s hard to be in this space part-time if you’re looking to gain exposure. If you want to invest in the industry, you have two ways to go about it.   You find and invest with managers that live and breathe this industry every day, or   You live and breathe it yourself. It’s also essential to understand that this industry is a microcosm of the world in terms of it covering nearly all the verticals that exist. Cannabis can bring opportunities in: Agtech SAS tech   Supply chain  Data  Advertising, media and marketing  Real estate  Cultivation  Manufacturing Retail If you want to begin investing in cannabis, you just have to know where to look. Once you spend the time to understand this industry, you’ll then have to familiarize yourself with the various subsequent verticals. For the individual investor, it is a multipronged process of diving in fully to understand the industry as a whole, and all moving parts to uncover the best opportunities. Read more from our recent eGuide: https://staging.startupfundingespresso.com/how-we-invest-vol-vii/  Hall T. Martin is the founder and CEO of the TEN Capital Network. TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    Investing in People

    1 min read When you invest in a startup, you are investing in people. Starting a business isn’t easy. It often consists of long days, stress, frustration, and never-ending challenges. As an investor, one of the most significant impacts you can make is being mindful that you’re dealing with people who are working under enormous amounts of pressure. Keep in mind that you are investing in people. Without the team, there would be nothing for you to invest in. Learn to get comfortable, not just with the company, the technology, and the business plan, but with the people as well. Get to know the founders. Get to know the entrepreneurs. Try to understand them on a personal level, and don’t be afraid to spend time with them. Make an effort to go out with them for dinner, have a coffee with them and catch up. Focus on building a relationship and thoroughly getting to know the people you are working with. Pay attention to how they operate under various circumstances because, no matter what, you’re investing in them and not the company or the product. If the technology doesn’t work out or the market changes, you’re banking on these people to move with that change. You want to have faith that the team can pivot the business in another way. You’ll go through many ups and downs with these individuals. The key to making each up and down successful is having a strong relationship with the entrepreneur and never forgetting that they are what you are investing in. Continue reading in our latest eGuide: How We Invest Vol. VII Hall T. Martin is the founder and CEO of the TEN Capital Network. TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

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    What’s Getting Funded?

    The Coronavirus Impact on What’s Getting Funded 1 min read The Coronavirus pandemic impacts what venture capital funds are investing in. We’ll see changes in the following ways: Goods and services deemed ‘essential’ will receive funding such as cannabis, CBD, and hemp. Alcohol will see increased funding as well. In the wellness category, smoking cessation, nutritional supplements and other products that strengthen the immune system will be attractive to investors. For Fintech, digital payments, and Insurance-tech will attract investors as it eliminates physical cash and moves transactions online. In biotech, vaccines and virus detection will see increased funding. Remote-work software and online-engagement tools for gyms, educational institutions and others will see strong interest. For healthcare, equipment in critical demand will receive funding such as medical supplies, medical equipment, diagnostics and tele-health systems. Supply chain services and logistics such as automated ordering, AI-based systems, and delivery to the home will receive funding. Supply-chain-visibility startups will see strong interest as well. In general, online content and engagement such as tele-health, tele-physical training, and tele-education will receive funding. Finally, automation in warehouses, data centers and robotics will see investor interest. Robotics and AI were once perceived as destroying jobs but will increasingly be viewed as a necessity.

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