Frequently Asked Questions
About Angel investing & Venture capital investors
What's the Angel Kings' definition of "Angel Investor"?
Big impact. Big returns. You are an affluent individual who wants access to top startups where you can create jobs and have an impact on the American economy. Angel Kings investors are startup business people themselves - bootstrappers and visionaries who create jobs and have have an impact on the lives of people are America.
How can you invest in startups?
Once you verify whether you are an accredited investor, we will require a membership fee within 24 hours. Once this membership fee is paid, you will get instant access to America's top-ranked startups.
What is the new SEC's JOBS Act?
The Securities and Exchange Commission voted unanimously to propose rules under the JOBS Act to permit companies to offer and sell securities through crowdfunding. Crowdfunding describes and evolving method of raising capital that has been used outside of the securities arena to raise funds through the internet for a variety of projects ranging from innovative product ideas to artistic endeavors like movies or music. The Jumpstart our Business Startups Act is changing the face of angel investing and creating new opportunities to access fast-growing startups.
What is an angel investor?
An angel investor is an individual with a high net worth who invests his own money in startup companies. Angel investors are typically qualified as accredited investors, which means they have a net worth of at least $1 million or an annual income of $200K. These types of investors are usually entrepreneurs or businessmen who have a passion for a specific industry that they want to see grow.
What are angel groups?
The purpose of angel groups is to provide angel investors with a platform where they can combine efforts with other angel investors to provide startups with one large, collective fund instead of multiple smaller funds. Investors typically want to invest in multiple funds rather than just putting all of their money into one. However, startups need a couple million dollars to get their businesses going.
Why should I invest in a startup?
If you are considering investing in businesses with the expectation of making tons of money with no strings attached, think twice! Investing in companies is very risky, especially when investing in startups. Most investors are entrepreneurs themselves and decide to invest in other startups to support other entrepreneurs down their similar paths to success.
How can I decrease my risks?
Don’t put all of your eggs in one basket. Although you should diversify your portfolio, it is best to invest in a couple of seemingly promising startups rather than hundreds of random ones. Angel Kings hand picks the hottest ten startups and organizes them by investment category for you. You should also choose investment funds that suit you best so you are well knowledgeable on the business and industry.
How are the startups’ valuations determined?
The startups themselves are responsible for their own valuations based off of the information they provide us to back up their claims. Valuations often shift over time depending on how much funding they receive and how quickly they grow with it. Early-stage startups that are growing fast are valued around $3 - $5 million at first. The type of industry and current associations of the startup also has an impact on valuation.
How long until I see a return?
Returns vary for every investor. It could be years or decades before you see a return, if any at all! A startup must liquidate before you see any returns. This means will you get your return on your investment in the startup when it goes public or is acquired, but may not in the case of a bankruptcy. In order to avoid the latter, Angel Kings performs tons of research and analyses on the startups that are compiled into portfolios.
What is a venture capitalist?
A venture capitalist or "VC" is an individual or group (General Partners) that makes calculated investments in early stage companies and returns the profits of their early investments to original limited partners (LPs). A venture capital firm like Angel Kings has calculated ROI and makes investment decisions based on historical performances of similar or new companies in the same industry.
Where can I learn about investing in startups?
The best place to learn about investing in startups is by reading the best-selling book on startups and venture capital investing, Kings Over Aces, by early investor and expert Ross D. Blankenship. Blankenship is also the founder of AngelKings.