Wrote a comment over on David Lerner’s blog on his “Are Super-Angels Extinct” post. He said
What I am saying is that some of these superangel funds may structurally resemble traditional VC funds, but they are something altogether different- and more akin to an angel group.
My comment was that structure matters. If you set up the Red Cross just like a bank, with the same incentives, they would have caused the Panic of 2007.
Maybe it’s just two different world-views. I’ve thought about this and written about it for a long time. My take is that if you want to create a better venture capital system, you need to change the system, not just the people. Calling yourself a super-angel and saying you are different does not change the investing world. Changing the processes and structures of the investing world will change the investing world. There are firms (and super-angels) doing this.
In the spirit of changing the game, some “old-style” and “new-style” comparisons:
|Money managers||Company builders|
|Organized like a law firm||Organized like a start-up|
|Managing $1bn||Managing $25mm|
|Living on management fees||Living on expected future carry|
|Scaling by hiring more partners||Scaling by being more efficient|
|“Loose lips sink ships”||“You should read my blog”|
|Going to NVCA meetings||Going to the R Meetup|
|Joining Angel Investor groups||Writing $25k checks|
|Starting an owned seed fund/ incubator/ hackathon||Supporting a grass roots effort|
|Participating preferred||Straight preferred|
|LPs measure success by: IRR||LPs measure success by: IRR|