Angel investors and algae
The art of communicating with an angel investor is something Will Kusler, acting CFO of Ntractive and a member of the Dakota Renewable Energy Fund, says that few can master, but all should try. I provided several key points any algae startup developer should remember in “Tips for every algae startup.” Kusler spoke about many of them during a presentation on angel investing and energy I was fortunate enough to attend recently. While Kusler and the other presenters were not specifically speaking on the subject of algae, their comments can certainly translate.
On the “art,” Kusler pointed out the difference of time spent on a project between an entrepreneur or developer, and an angel. The entrepreneur or project developer is of course focused 24/7/365, but the angel on the other hand, is in it only part-time. “You expect that an email or a phone call sent out will be returned immediately, but that is not the case,” he says. Because of the time difference between the developer and the angel, regularly scheduled meetings are important. Also, keep updates regular, concise and to the point, Kusler says. And, “make sure when you have an important piece of information you can frame that in the right light and it doesn’t get lost in the shuffle of a five-page business update.”
Who is the thought leader? That is the most important question someone looking to find capital from an angel or group of angels, according to Dan Hodgson, managing director for Linn Grove Venture Funds. For Hodgson, knowing who the thought leader, or the person who understands an industry, market or technology sector the best, is the person to establish a relationship with or at least reach out to. The thought leader is the most important because as he put it, it is the person whom the rest of the angel community will turn to for advice in their own decision making. Part of the reason a highly regarded opinion maker is important to seek out, he added, is because from his perspective, “business strategy is as important, or more important, than technology.”
Why no’s are good. That statement may sound odd, but if you ask any of the presenters on the panel, the idea is true, and it is a great statement for any algae startup to remember. A no, the presenters explained can help you learn more about your business, it can help you understand what an angel is looking for, and in all cases, it gives you an opportunity to find the answers that might change a business strategy for the better.
Correction: In the original posting of this blog Will Kusler was incorrectly identified as the CEO of Ntractive. Will Kusler never served in that capacity. The active CEO of Ntractive is Justin Bartak.