I think that's key... certainly, some opportunities that were worth a shot when everyone was flush with cash are now untouchable, but angels, like all other wealthy individuals, are still looking for good business opportunities. Convincing them might be a bit harder and require a somewhat more "this start-up will make money, here's how" approach, but it should still work.
I think it's for the best, because it has only reinforced our scrappy cockroach nature, but our 'looking for angel funding' was pretty much simultaneous with the meltdown, and things are definitely slower than they would have been had there not been said meltdown.
That said, we have been able to keep conversations going, and I believe it's because we have a number of viable business models in the works.
"In 2007, the company raised $715,000 in its first round of angel financing from eight investors. When the founders approached current and new investors for more capital in September, they were met with silence."
Why did investors think this
was a good business opportunity in the first place?
The bigger question is why they needed to raise $715k and still needed more.
The fact that they didn't manage to get a second round (and that's a fact that is now very well published) could be due to any number of reasons, such as missing critical goals that they've set in their original presentation and/or changes in the marketplace. It's hard to tell what the real cause is without asking the 8 angel investors involved.
Drawing far reaching conclusions ('angels flee from tech start-ups') from a single sample is not very solid science.
One possible reasons why angel investors are holding back is because of their stock portfolios taking a huge hit.
I also don't see not wanting to invest for a second round as 'pulling out', and I think the fact that all 8 responded unanimously says a lot more about 'twosmartdogs' (what a name) than it does about the investors.
They've had their shot, now they will either have to swim or sink. It's not different for the rest of us, with or without outside investors.
Bounce around craigslist for a bit and see how many people are buying and selling lessons. It's a big business.
Seriously. Answer ten teacher wanted ads and 2-3 will be scams of some sort.
"Copyright © 2007 Two Smart Dogs "
Don't get me wrong, there are some wonderful angels out there -- for example, accomplished university professors (a secretly wonderful reason to go to college, even if you are career-obsessed and don't care for a liberal arts education or hooking up with confused 19 year olds), or successful veterans of the field in which you are operating (such as Aydin Senkut, referenced in that article, or our good friend pg) -- but on the whole, the "angel investor" industry is a total waste of time, and a total distraction.
Also, from what I hear from VC friends, some angels can make your Series A a real pain; they don't pay to play, and they get antsy about dilution. I'm sure pg would have more insight on this matter than I.
we've also been very happy working with angels, but it might just be that we've been lucky enough to have great investors.
based on my experiences, i would highly recommend finding a way to work on your business full time as soon as you can.
