In the ecosystem of tech startups, Angels are the players that hope to come along for the ride, and make a lot of money without sweat equity. “Most angels are salty dogs, broken down warriors who want to be in the arena but don’t have the stamina and energy to fight anymore,” notes investor, Twitter King, publisher, software developer, conference producer and in-your-face TV personality Jason Calacanis in his first book, “Angel: How to Invest in Technology Startups.”
Calacanis thinks there are definitely a number ways to be a smarter angel. If they play their cards right and play the field with 10 or more investments, angel investing can provide a far higher rate of return than other investments.
Nine of 10 startups fail, but an occasional winner – perhaps even a “Decacorn” like an Uber or Snapchat — will more than offset those losses. Calacanis himself has invested $10 Million for a portfolio that is theoretically valued at $150 Million.
Not everyone, of course, will have access to the winners that Calacanis has invested in (Uber, Thumbtack, et al). In fact, startups come to him as an early bird, hoping to lure others on the basis of his validating investment. They also can’t afford to mess with him. As he colorfully told a venture capitalist: “Jason Calacanis does not eat shit.”
Still, he argue that average investors can beat the bank and beyond by paying attention, following their instincts, hopefully moving to the Bay Area….and most importantly, joining a bunch of angel syndicates to diversify their risks and build their network.
This book is entertaining but perhaps, not as funny, outrageous or insightful as Calacanis can be at conferences, on Twitter and his blog. This book would, however, be a very helpful culture guide to the doctors, gym owners and real estate developers that you’ll often see throwing $50K+ at a startup.
What I like most about the book, actually, is that it gives real insight into the way that Calacanis and his high powered friends are thinking when you are pitching them. That’s worth a lot.