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Comments on AngelBlog:
From Ask the VC by Brad Feld June 8, 2008
More Thoughts on Structuring an Angel Investment
I'm not a fan of convertible notes as the form of an angel investment. When I'm making an angel investment, I much prefer to price the round and do a "light Series A" (simple terms, but still a preferred instrument.) Basil Peters has a series of posts up on Angel blog that talks about the problems of Convertible Notes for Angel Investing, suggests Exchangeable Shares for Angel Investors, and even provides a One Page Term Sheet for Angel Investors.
Posted in: Angel Investing
Very helpful stuff, especially the one-page term sheet. It pays to keep it simple, up-front.
Thanks!
The Startup Guy March 4th, 2008
Basil Peters has a great single-page term sheet
If you’re an angel negotiating with a company OR a company heading towards an angel-based round, you should have a quick peek at Basil Peters’ one page term sheet. It’s chock full of good ideas about how to come to an agreement without huge legal bills.
The site is worthwhile for other reasons, too. It has a lot of well-thought-out content that will be very helpful to both investors and startups.
From Sophisticated Finance by Rober Hacker June 9, 2008
Early Stage Financing Site
Through a post by Brad Feld I came across a very informative site on early stage investment, angel financing and venture capital. The site is Angel Blog and is written by Basil Peters. Mr. Peters is a former tech CEO who achieved sufficient success to become an angel investor and then started managing technology oriented hedge funds. He writes very coherently about seed financing in all of its variations. His current posts are on friends and family financing.
Before you bombard him with requests to finance your startup, please note that he is located in Vancouver and not likely to finance a startup very far from there.
From Dr. Terry Jones June 14, 2008
Thanks for taking the time to write so many articles on your Angel Blog. I don't agree with it all, but it's all thought-provoking and I'm far from done in thinking about your positions.
In any case, it's of really high value to find all your material - I have spent lots of time reading startup and funding information on _many_ sites, and there are very few that have a really a high signal/noise (where "noise" is usually repetition of cliches & received wisdom, etc).
Despite relatively little experience (a few startups, one serious board) I believe deeply in the importance of alignment of interests. It's always worth looking for non-alignment in a potential deal and working to eliminate it.
As for it being a new concept, the ancient Greeks understood the power of alignment of interests. The following is from the speech of the Corinthian delegate to the Allied Conference in Sparta, via Thucydides:
From every point of view, therefore, you have good reason to go to war, and this course is what we recommend as being in the interests of all of us, remembering that identity of interest both among cities and among individuals is the surest of all guarantees.
This from page 107 of the Penguin edition of the History of the Peloponnesian War. While I'm sure you meant that the importance of alignment is a new concept in the funding world, the Thucydides quote is nice.
