Entrepreneur Office Hours - Issue #57
Can I teach you to build the "next Amazon"?
I got invited to guest lecture for a class about Amazon. The professor who invited me wanted me to explain why Amazon was so successful, and he wanted me to share my advice for building the “next Amazon.” At first, it sounded like a ridiculous request. However, the more I thought about it, the more I realized building the “next Amazon” isn’t so hard. At least… it isn’t hard in theory. It’s so easy, in fact, that I explain how to do it in this very issue of EOH. How cool is that?
If teaching you how to build a trillion dollar company wasn’t valuable enough.,I also tackle a question about angel groups. And I’ve got an article for you about the importance of timing in startups.
In other words, lots of good stuff for you today. As usual, if you like it, please press this little button and share it with a friend:
In theory, building a company like Amazon is a lot easier than you might think. Here’s what you need to know.
Lots of factors impact the eventual success of a startup. But is the biggest factor timing? In this article, I explain why it might be.
Office Hours Q&A
I’m looking for some advice about angel groups. Do you think they’re a worthwhile source of capital? Or would you suggest sticking with individual angels and professional VCs?
I’ve taken funding from angel groups, and they’re certainly a viable source of capital. Are they worthwhile? I suppose that depends on the angel group and your needs.
I wonder if the better question -- and the question you’re trying to ask -- is something more along the lines of “Is it worth pursuing money from angel groups?” And (again, I’m guessing), the reason you’re asking is because angel groups tend to have their own strange, time-consuming way of vetting startups.
The challenge with raising capital from angel groups is that, by definition, they require groupthink. That’s a byproduct of them being comprised of large collections of people trying to make decisions together.
We all know groupthink isn’t efficient. When you’re an entrepreneur in a hurry to raise a round of funding and get back to building your company, this lack of efficiency can get frustrating.
So, yes, raising capital from angel groups often takes more time than raising from individuals and VCs. That’s definitely a drawback.
Conversely, angel groups have the benefit of giving you, the entrepreneur, lots more resources and connections than individual investors or VCs. If you get investment from an angel group with 100 members, that’s 100 members you can ask for help/resources/advice/intros. because all of those people are literally invested in helping your company succeed.
So… is an angel group a worthwhile source of capital? It certainly has its drawbacks (longer time to make decisions) and its benefits (more connections/resources). What’s most valuable for you?
Got startup questions of your own? Reply to this email with whatever you want to know, and I’ll do my best to answer!