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The Seed Stage Start-up Funding Strategy

1 points by strategicman 14y ago

From first hand experience working with a private equity seed stage group, learn what to do and what not do when engaging investors in your first round.

wtvanhest 14y ago
I'm not sure where the author is getting his advice but an NDA is almost never standard in angel rounds. If a company can't openly talk about what they have, they likely do not have a competitive advantage worth talking about.
- strategicman 14y ago
  Depending on the type of company and product that they offer. Seed rounds are also made by institutional investors who require much more legal documentation than a non-disclosure agreement. IF you're thinking an Angel round from a friend or family type of investment that I would agree that it's not absolutely necessary. However to say that it's almost never used is too much of a far reaching comment. I've signed and agreed to verbal non-disclosure to engage in the due diligence process. Perhaps you misunderstood Seed Stage vs. an Angel investment. The funds listed that invest as "angels" syndicate and engage in a full due diligence process.
  - wtvanhest 14y ago
    Angel investors often make "seed investments" and are not two separate categories. http://en.wikipedia.org/wiki/Seed_money http://en.wikipedia.org/wiki/Seed_money Angel investors are essentially not institutional by nature. I do not know of a single "institutional angel". However it’s not to say it couldn’t eventually happen or that there isn’t an edge case I am unaware of. All VCs on the other hand are institutional. The difference in title (institutional vs not institutional) comes from how they fund their investments. VCs pool money from investors who choose VC as a vehicle; angels typically use their own money or a small amount of outside pooled money. http://en.wikipedia.org/wiki/Institutional_investor http://en.wikipedia.org/wiki/Institutional_investor The NDA is extremely rare for any even semi-proficient investor to sign. Professional investors flat out refuse to sign them in almost every case. http://www.venturestab.com/2011/02/why-startups-shouldn%E2%80%99t-ask-investors-to-sign-ndas/ http://www.venturestab.com/2011/02/why-startups-shouldn%E2%8... (this is just the first link I found in google, there are literally 100s of articles written about this topic and is one of the most basic out there).

1 points by strategicman 14y ago

From first hand experience working with a private equity seed stage group, learn what to do and what not do when engaging investors in your first round.

wtvanhest 14y ago

I'm not sure where the author is getting his advice but an NDA is almost never standard in angel rounds. If a company can't openly talk about what they have, they likely do not have a competitive advantage worth talking about.

strategicman 14y ago
Depending on the type of company and product that they offer. Seed rounds are also made by institutional investors who require much more legal documentation than a non-disclosure agreement. IF you're thinking an Angel round from a friend or family type of investment that I would agree that it's not absolutely necessary. However to say that it's almost never used is too much of a far reaching comment. I've signed and agreed to verbal non-disclosure to engage in the due diligence process. Perhaps you misunderstood Seed Stage vs. an Angel investment. The funds listed that invest as "angels" syndicate and engage in a full due diligence process.
- wtvanhest 14y ago
  Angel investors often make "seed investments" and are not two separate categories. http://en.wikipedia.org/wiki/Seed_money http://en.wikipedia.org/wiki/Seed_money Angel investors are essentially not institutional by nature. I do not know of a single "institutional angel". However it’s not to say it couldn’t eventually happen or that there isn’t an edge case I am unaware of. All VCs on the other hand are institutional. The difference in title (institutional vs not institutional) comes from how they fund their investments. VCs pool money from investors who choose VC as a vehicle; angels typically use their own money or a small amount of outside pooled money. http://en.wikipedia.org/wiki/Institutional_investor http://en.wikipedia.org/wiki/Institutional_investor The NDA is extremely rare for any even semi-proficient investor to sign. Professional investors flat out refuse to sign them in almost every case. http://www.venturestab.com/2011/02/why-startups-shouldn%E2%80%99t-ask-investors-to-sign-ndas/ http://www.venturestab.com/2011/02/why-startups-shouldn%E2%8... (this is just the first link I found in google, there are literally 100s of articles written about this topic and is one of the most basic out there).