Sublime

After the Series A, you’re probably no longer actively investing in the company, and it’s well on its way to an exit. In fact, if your angel investment is starting to raise a Series B, C, D, or further rounds of financing, it’s probably time for you to consider selling some part of your stake in what’s called a “secondary” stock sale.

For the angel who paid $100,000 of their own money for their one million shares, getting back $1 million would be a fantastic and compelling outcome—$900,000 in profit! They also might consider selling half their shares to investors in a new round ($500,000 worth) as “idiot insurance” in case the company eventually fails, while letting the other

When someone tells me they have a founder they want to introduce me to but they’re worried because the person is a wild card, I set that meeting up for the next day. Angel investors are looking for wild cards, because the best founders are typically inflexible and unmanageable, pursuing their visions at the expense of other people’s feelings.

Due to the fund economics of early stage investing it may not make sense to do a pro-rata, or follow-on investment with a $5M Series A in order to maintain our 20 percent. As the entrepreneur continues to raise capital, the early stage investors will continue to experience a valuation dilution or divergence in their investor shares, effectively