Angel inefficiencies
I am constantly fascinated to learn about angel investing. I suppose that one of the reasons that the space is so interesting is because it isn’t a very efficient market (There is very little information available on the deals that are done and who, in fact, is an angel investor). I have read books, articles, blogs, and research on characteristics of angel investing and they all communicate a similar message…but the question is…does anyone really know?
One of the challenges that we have at FundingUniverse.com is tracking deals that happen through our services. There are many other similar services that claim responsibility for huge amounts of funding deals, but I wonder how accurate they are. We have intentionally avoided tracking because:
- We provide services and tools to help entrepreneurs and investors connect with each other
- Angels spend a lot of time and invest their personal funds to make a deal happen — because of that, we don’t want to take credit for something that is so personal to them, and
- It is very hard to know when a deal is done
People have been looking for a solution to this problem for years without any success. We have brainstormed ideas on how to gather the information… without much success. To me, it’s almost like tracking the number of dates that college students go on…the only way to get the information is to ask.
But what if they don’t want to tell you? What is in it for them? They might wonder why you care. The logical solution to the problem is to offer some sort of incentive, but even then it won’t be completely accurate. Do you know anyone that is making headway in this area? I’d love to hear your suggestions on how the market can solve this inefficiency. For now, we’ll just be satisfied to know that entrepreneurs and angel investors are in fact connecting on FundingUniverse.com.








Brock,
Let’s talk about what I am currently doing to track this information regionally. Also, our work to get that legislation in place for Angels (”The Angel Act”) next year should be a step in the right direction of providing incentives and trackable information.
Nathan