Comments on: How to Search for Angel Investors the Right Way – the Responses http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/ Turnaround Management, Senior Adviser, Board Member, Executive Coach, Author, Speaker, Radio & TV Guest & Panel Member Sun, 05 Sep 2010 23:41:13 +0000 hourly 1 http://wordpress.org/?v=3.0.1 By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-13024 Dr. Earl R. Smith II Sun, 23 May 2010 15:28:59 +0000 http://www.dr-smith.info/?p=5118#comment-13024 Alan Sporn wrote: I read your article, Angel Investors - The Good, Bad and Very Ugly and it is literally right on the money (no pun intended). My situation is unique in that I had invested a great deal of time/money into a company that was pitched to me by (2) broker-dealers from NY. The company at one time had well over $300,000,000 in sales in the dietary supplement business but had filed for Bankruptcy protection after the FTC sued them for making a false claim. The bottom line is that after I put money in, it was diverted/embezzled. I sued and obtained a 26-page Federal TRO and Preliminary Injunction. Towards the end of 2008 the Defendants settled and I ended up with all the assets, intellectual property, etc. It is difficult finding both an honorable partner/investor to help re-build what is still the top 5 dietary supplement brand in the USA, has proven an extremely difficult task. Best Regards Alan Alan Sporn wrote:

I read your article, Angel Investors – The Good, Bad and Very Ugly and it is literally right on the money (no pun intended).

My situation is unique in that I had invested a great deal of time/money into a company that was pitched to me by (2) broker-dealers from NY. The company at one time had well over $300,000,000 in sales in the dietary supplement business but had filed for Bankruptcy protection after the FTC sued them for making a false claim.

The bottom line is that after I put money in, it was diverted/embezzled. I sued and obtained a 26-page Federal TRO and Preliminary Injunction. Towards the end of 2008 the Defendants settled and I ended up with all the assets, intellectual property, etc.

It is difficult finding both an honorable partner/investor to help re-build what is still the top 5 dietary supplement brand in the USA, has proven an extremely difficult task.

Best Regards
Alan

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-12324 Dr. Earl R. Smith II Sat, 20 Feb 2010 20:48:14 +0000 http://www.dr-smith.info/?p=5118#comment-12324 Ali Zartash-Lloyd wrote: Hi Earl Great article and perhaps a bit of the painful truth! Just a contribution to your excellent advice: 1. Ask for a reference! Strange you may say when you have the proverbial begging bawl out, but the reality is any business relationship is a two-way street. When you are being interviewed for a job (remember those days?), did you ever ask to talk to existing employees? Well may be you should have. You are giving up a piece of your business which you have worked your guts out for, so why should anyone think it is strange to ask for a reference? Talk to other companies they have invested in, get their views and without the person being involved if you want the truth told! 2. Make a watertight contract and as Earl suggests make sure everything is covered. It is better to have a fall out before the wedding than afterwards. Remember divorces cost 10 times more than any cancelled wedding (ask Paul McCartney!). 3. Take professional advice. This is one of those occasions you should not rely on your entrepreneurial skills alone. Angels, non-execs and investors do this for a living, so what makes you think you can match them or outsmart them? Pay someone who does this for a living to put together an agreement that protects both parties’ interests. Remember a good deal is only when everyone wins. Finally, if you are looking for funds we have investors that are willing to support any sound business that is looking for extra cash to deliver growth or survive tight cash flow situation but their banks are being … eh… well bankers! Ali Zartash-Lloyd wrote:

Hi Earl

Great article and perhaps a bit of the painful truth!

Just a contribution to your excellent advice:

1. Ask for a reference! Strange you may say when you have the proverbial begging bawl out, but the reality is any business relationship is a two-way street. When you are being interviewed for a job (remember those days?), did you ever ask to talk to existing employees? Well may be you should have. You are giving up a piece of your business which you have worked your guts out for, so why should anyone think it is strange to ask for a reference? Talk to other companies they have invested in, get their views and without the person being involved if you want the truth told!

2. Make a watertight contract and as Earl suggests make sure everything is covered. It is better to have a fall out before the wedding than afterwards. Remember divorces cost 10 times more than any cancelled wedding (ask Paul McCartney!).

3. Take professional advice. This is one of those occasions you should not rely on your entrepreneurial skills alone. Angels, non-execs and investors do this for a living, so what makes you think you can match them or outsmart them? Pay someone who does this for a living to put together an agreement that protects both parties’ interests. Remember a good deal is only when everyone wins.

Finally, if you are looking for funds we have investors that are willing to support any sound business that is looking for extra cash to deliver growth or survive tight cash flow situation but their banks are being … eh… well bankers!

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-12261 Dr. Earl R. Smith II Wed, 17 Feb 2010 18:26:20 +0000 http://www.dr-smith.info/?p=5118#comment-12261 Feargal Byrne wrote: Excellent article. It's takes the blinkers off entrepreneurs who are seeking angel investment. Great insight. Feargal Byrne wrote:

Excellent article. It’s takes the blinkers off entrepreneurs who are seeking angel investment. Great insight.

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-12259 Dr. Earl R. Smith II Wed, 17 Feb 2010 18:24:44 +0000 http://www.dr-smith.info/?p=5118#comment-12259 Scott, There is an old saying, "if you turn the other cheek, expect to get slapped". The purpose of my article and question is to help educate entrepreneurs so that what happened to you happens less in the future. In the end, you need to take responsibility for not paying sufficient attention to the details. My experience is that, if there is advantage to take, investors will take it. Dr. Smith Scott, There is an old saying, “if you turn the other cheek, expect to get slapped”. The purpose of my article and question is to help educate entrepreneurs so that what happened to you happens less in the future. In the end, you need to take responsibility for not paying sufficient attention to the details. My experience is that, if there is advantage to take, investors will take it. Dr. Smith

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-11773 Dr. Earl R. Smith II Wed, 10 Feb 2010 18:52:26 +0000 http://www.dr-smith.info/?p=5118#comment-11773 Christopher Zuzick wrote: Excellent article! Christopher Zuzick wrote:

Excellent article!

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-11771 Dr. Earl R. Smith II Wed, 10 Feb 2010 18:51:39 +0000 http://www.dr-smith.info/?p=5118#comment-11771 Dennis Meekins wrote: Thank you Dr. Smith for a very accurate depiction of the field. Our recent experience exposed another player - the "Masked Angel" - claims to have money but really wants to be paid for consulting to introduce you to his "network" of potential investors. I put them below the Bottom Feeders. Thanks again. Dennis Meekins wrote:

Thank you Dr. Smith for a very accurate depiction of the field. Our recent experience exposed another player – the “Masked Angel” – claims to have money but really wants to be paid for consulting to introduce you to his “network” of potential investors. I put them below the Bottom Feeders. Thanks again.

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-11769 Dr. Earl R. Smith II Wed, 10 Feb 2010 18:50:57 +0000 http://www.dr-smith.info/?p=5118#comment-11769 Thanks for the kind words Robert. I am glad that you find them useful. Thanks for the kind words Robert. I am glad that you find them useful.

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-11767 Dr. Earl R. Smith II Wed, 10 Feb 2010 18:50:12 +0000 http://www.dr-smith.info/?p=5118#comment-11767 Robert Kim wrote: Thank you, Dr. Smith. Your articles are pure gold. Robert Kim wrote:

Thank you, Dr. Smith. Your articles are pure gold.

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-10562 Dr. Earl R. Smith II Fri, 22 Jan 2010 18:48:25 +0000 http://www.dr-smith.info/?p=5118#comment-10562 Gurmeet Singla wrote: Awesome article and very informative especially someone like me who is working on a business concept and will search for angel investors in very near future. Thanks Dr. Smith. Gurmeet Singla wrote:

Awesome article and very informative especially someone like me who is working on a business concept and will search for angel investors in very near future.

Thanks Dr. Smith.

]]> By: Dr. Earl R. Smith II http://www.dr-smith.info/how-to-search-for-angel-investors-the-right-way-the-responses/comment-page-2/#comment-10561 Dr. Earl R. Smith II Fri, 22 Jan 2010 18:47:28 +0000 http://www.dr-smith.info/?p=5118#comment-10561 songclash.comsongclash.comsongclash.com Juan Carlos Cruz wrote: Enjoyed reading your article Dr. Smith. Performance metrics are the most valuable asset I can re-emphasize on. Having measurable points on everyone's efforts can really show where changes or adjustments can be made. Thank you very much for sharing the article with us Dr. Smith. Best regards, Juan Carlos www.songclash.com songclash.comsongclash.comsongclash.com

Juan

Carlos Cruz wrote:

Enjoyed reading your article Dr. Smith.

Performance metrics are the most valuable asset I can re-emphasize on. Having measurable points on everyone’s efforts can really show where changes or adjustments can be made.

Thank you very much for sharing the article with us Dr. Smith.

Best regards,
Juan Carlos
http://www.songclash.com

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