Power point presentation from ULC talk on April 16, 2012

1. About Me
• Co-Founder of Hyde Park Angels (www.hydeparkangels.com)
• Blog at pointsandfigures.com
• Tweet @pointsnfigures
• On Facebook, Linked In, Pinterest, Instagram, Google+, YouTube, Yelp, Trip
Advisor, Klout, Angel.co, Built In Chicago and any other social network you
care to name. Friend me or follow me if you want
• Trustee at the National World War Two Museum (
http://www.nationalww2museum.org) in New Orleans, Louisiana
• married, two kids in college; traded for 22 years at the CME where I was on
the Board of Directors
• BS Univ of Illinois, College of Business; MBA University of Chicago, Booth
Graduate School of Business

2. What is An Angel
Organization?
Different Structures, different expectations
Classic definition is a group of investors that want to
come together to invest in seed stage companies for
fun and profit
Union League Angels?
Imagine if 20 people wanted to invest $200,000 in companies over five years. That’s $4 million dollars. It’s
enough to be a respectable angel group in Chicago.

3. Typical Angel Deals
• Average Valuation is $1-3M pre-money.
• Most seed rounds are between $300k and $1M depending on the business
• Seed round should be 12-18 mo runway (company is pre revenue, pre
product)
• Board seat or board observation rights
• Usually, but not always, co-investors in the round
• Angels looking for return. Average return for all angel deals is around 27%
IRR (Includes the ones that went bust)
• Typical deal is 5-7 years in length.

4. What An Angel Does
• Invest Money
• Create Customers, Connections
• Mentor and Advise
• Help Find Talent for Firm
• Create Next Rounds of Financing
• Create Possible Exits
• Network, network, network
• Angels typically don’t run companies, nor do they replace management

5. What Do Angels Look
For?
• Solve a pain point, a problem
• Big Market (Market Size)
• Evidence the Jockey can execute
• Ability to build a rapport with the Entrepreneur
• Does the entrepreneur have integrity? Be honest-no Enron Accounting!
• Does the entrepreneur want to build a blow out business, or lifestyle business?
• Evidence the product works (no ideas, actual products)
• Evidence there is some demand (some customers)
• Disruption-product should be a game changer in some way (Andy Kessler “Eat People”)
• Potential Exit(Who’s going to buy you?)

6. Don’t Want to Be An
Angel?
Invest in a fund. I know where to make that happen!
Put capital to work creating value

7. What Should
Entrepreneurs Look
For In An Angel?
• Some industry expertise or focus
• Some connections, a good personal network
• Trustworthiness. Can you trust this person to be involved in your business?
• Local. Long Distance Angels generally don’t work out.
• No check writers. You want more than just money.

8. Create A Silicon
Prairie?
• NO!!!!
• Create Something Unique
• Let’s Knit a Midwestern Quilt