Some thoughts about angel investing

The first thing you must know about this topic is that it isn’t everyone’s cup of tea… I am an angel investor and I can tell is a risky game: sometimes you win, sometimes you lose. But it is always a rewarding and exciting experience. Why? Well, business angels bet on early-stage startups or projects that they really believe in. They become something more than the person that gives you the money; they are a sort of mentor for the founders. And, for me, it is worth it. 

I did more than 40 angel investments over the last years and with very different outcomes. So, I perceive myself as an experienced angel investor. To pick the right investment is a combination of the right founders, luck and patience. 

A good angel is not only somebody with money but also with network and experience. 

Here are some reasons why becoming an angel investor can be interesting:

1. High returns: One of the main reasons why people become angel investors is this one. (Good) Startups in an early-stage like seed or pre-seed can have a high growth potential. If the company is successful, the value of the angel investor's equity stake can increase significantly, resulting in substantial returns.

1. Supporting entrepreneurs: Sharing your knowledge and giving a chance to other professionals with innovative ideas is more than investing. It is a commitment to something bigger -- you are helping to build the next big thing.

1. Free lessons: Yes, you won’t only be the teacher, you will also be a trainee. I mean, in this position, you will be quite close to the founder and CEO and have the opportunity to learn about different industries, business models, and investment strategies. 

1. Being involved in various decision-making processes: Angel investors usually have a say in the decision-making process, at least in the beginning. They can offer network, guidance and mentorship to the management team. This can be a valuable experience for investors who are interested in being actively involved in the growth and development of a company.

1. Diversifying: It can also be a way to diversify an investment portfolio. Many angel investors view their investments in startups and early-stage companies as a way to balance out the risks associated with more traditional investments, such as stocks and real estate.

1. Potential for social impact: Angel investing can also be the way to make a positive social impact. Many startups and early-stage companies are focused on addressing social and environmental issues, and angel investors can play a key role in supporting these types of ventures.

Those are my points, but each one must find their motivation to try it. Remember that it is a high-risk, high-return investment and requires thorough research, due diligence, and a long-term perspective, but that’s something most angel investors know very well as they often have been entrepreneurs before or invested in other ways.