Recently, Japan’s Softbank Group has a debt of 160 billion U.S. dollars on a hot search. The founder of Softbank Masayoshi Son opens his eyes every day, which is a huge interest of 300 million. Many entrepreneurs know that Masayoshi Son is because he once invested 21 million U.S. dollars in Alibaba’s Jack Ma, the income reached more than 10,000 times, and Masayoshi Son became famous since then. Looking back at Masayoshi Son’s investment history, 90% ended in failure.
How do angel investors make money?
A few days ago, an entrepreneur came to me and said that a friend invested 1 million USD in a project last year. Now the 1 million USD has been spent, and now I have to pay employees 100,000 USD a month. They invested and helped them tide over the difficulties. I read his “Business Plan” and felt that the project was not bad, so I asked him to come to our company for an interview. After I talked with him for more than an hour, I asked him clearly about his situation. I said that we can’t invest in your situation.
I said, you still don’t know the investment rules of our angel investment, so I just talked to him about the investment logic of our angel round. Entrepreneurs looking for angel round investment is not only financing but also wisdom and financing source. Financing funds alone is useless because after your money is spent, the follow-up funds cannot keep up, and your capital chain is broken, and ordinary people will not accept such a plate. The so-called financial intelligence means that after angel investors invest, they must have post-investment services, which is to help entrepreneurs sort out business models, etc., not only that but also to help entrepreneurs introduce the resources behind the investors. They are the investors and the people. The often said round A, after round A enters, the angel round exits. Judging from the situation of the entrepreneur just now, it is obvious that the person who invested in him did not give the entrepreneur anything except money. After spending 1 million USD, he fell into a crisis again.
Why are angel investors unwilling to take over in this situation?
Because 1 million has been spent in the early stage, and the expected goal has not been achieved, the reason is nothing more than the following 3 points.
1. There is a problem with the business model.
2. The founder has a problem.
3. There is a problem with the founding team. If these three problems are not resolved, no angel investor dares to invest in you again.
There is an unwritten rule in the angel investment circle. Generally, no additional investment should be made. That is to say, if the 1 million is spent and the project is not completed, the angel investor will accept compensation and will no longer invest for you because This is a bottomless pit. If the problem is not solved, the amount of investment will be a waste of water. Therefore, I gave the entrepreneur an idea: you must reorganize the business model of your project, reorganize the team, refinance, establish a new company, and separate from the previous company so that it is possible to continue to obtain Financing. I introduced him to our “financing circle” and he readily accepted it. He also promised to participate in our private board of directors, learn about financing-related knowledge, and strive to raise funds as soon as possible.