10 Important Principles of angel

Investing
What rules might a higher investing
power pass on to angel investors, to
help in their quest for success in early
stage company investing?
Although not necessarily etched in
stone, well take a stab at what might
be considered the 10 Rules of Angel
Investing: a set of basic rules for
early stage company investing.
http://cosmosgroup.ae

1. Profit is the
Ultimate Goal.

Angel investing is not charity.

Invest to create successful companies.

Invest
or IPO).

The goal is to yield profits for future

investments.

Create

Grow

Exit (M&A

2. Invest in Great
Teams.

Avoid single member mad scientist

investment.

Great entrepreneurs build great

teams.

Great teams can overcome most

challenges.

Try to find, and fund, great teams

(business
experience, business diversity,
attitude).

3. Invest in Big
Ideas.

Look for big idea, where market is

heading.

Avoid the me too investment

(similar ideas in
crowded field).

But: big idea must be backed up

with data.

4. Invest in Large
Markets.

Large markets allow for growing pains;

larger
field, more playing time.

Large markets support inevitable

competition.

Even somewhat successful result

might yield
large exit in a large market.

5. Know The Valuation

Range.
Angel investing is risky investing, dont
overvalue.

Companies should be reasonably priced.

Use comps of similar companies but

always
adjust for risk.

Remember: failure more likely than

success, dont be afraid to walk away,
there will always be another deal.

6. Always Do Due
Diligence.

Angel investing is full of unknown

unknowns.

Use your due diligence time to uncover

them.

Take nothing for granted, be thorough.

7. Support Your
Companies.

Keep dry powder for future

investment rounds.

Listen and advise where you add

value.

Help keep the faith: start-ups

succeed with persistence and
patience.

8. Create an Investment
Portfolio.

If one or two out of ten or twenty are

homeruns, you need a portfolio of co.s to
increase odds.

Invest where comfortable but diversify.

Be patient: a good investment portfolio

takes time
to develop.

9. Know When to
Fold Em.

Dont throw good money after bad in

deals.

Dont just chase the homeruns

(100X exits).

Reasonable returns in a reasonable

timeframe (doubles, triples etc.
keep you in the game).

10. Give More Than You

Receive.

Always be teaching, as well as

learning.

Mentor and help entrepreneurs and

startups, even those you may pass
on, for investment.

Those you help, may later help you

one day.

I.
Profit is the
ultimate goal

II.
Invest in great
teams.

III.
Invest in big ideas.

IV.
Invest in large
markets.

V.
Know the
valuation range.

C
O
S
M
O
S
GROUP

VI.
Always do due
diligence.

VII.
Support your
companies.

VIII.

Create an investment
portfolio.

IX.
Know when to fold
em.

X.
Give more than you
receive.

Who are the COSMOS GROUP

Cosmosgroup.ae is an angel investment company

Cosmosgroup.ae is an angel investment company

which provides comprehensive support to the budding
community of
start-ups and entrepreneurs in the Middle East re
gion
. Our team of experienced internet entrepreneurs have
partnered and counseled several web start-ups in the
region.
We respect the spirit of entrepreneurs and start-up
community. And it is disappointing to hear about a
potential start-up not able to scale up due to lack of
funds. When we provide financial backing for such
startups or entrepreneurs, we invest in the person
rather than the firms viability. This helps us focus on
helping the business succeed under any circumstances.

C O S M O S
GROU
P
http://cosmosgroup.