More founders replace raising capital from family and friends with the new operator-angel round to de-risk technical dependencies, accelerate time to launch and build momentum for the next round.
Building on last week’s discussion ‘how to become a VC’ with an open discussion below:
Replace raising venture capital from family with an operator-angel round
There are three goals of an operator-angel round.
1. Accelerate your startup’s time to market
Rather than focusing on family and friends capital raising, drive strategic alignment with core integration partners and founders/operators who can open doors quickly.
2. Augment your team’s current capabilities
Find operators who can immediately deliver a high value per dollar invested through a focused body of work and immediate access to network. To do this, skip raising capital from friends and family. Instead:
- Choose angels based on relevant operating experience
- Create goals and focused body of work to leverage an individual angel’s superpower
- Continue to build momentum with angel until your startup has enough momentum to hire someone full-time. Leverage angel’s peer network to source, vet and onboard someone full-time
3. Act on first mover advantage and engage high-signal angels
New entrants will be viewed as a fast follow with a low chance of becoming the category leader. How?
- Build your sector-aligned CEO network to establish credibility with users & investors
- Leverage early investor alumni networks to scale hiring momentum & culture
- Box out competition with a bottom-up community of early believers and evangelists
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