Many people ask me how to get started in angel investing & since it's quite a closed ecosystem I'm happy to share what I've learned and some tips for getting involved. (thread)

First, I started angel investing by chance. I was looking to become a VC so had been actively researching all sorts of startups, but then a company called AirGarage reached out to ask me for feedback, then asked me to invest.

I thought - well I want to do this for my job, so why not test my gut? At the time, I didn't really know anyone who could give guidance on HOW to angel invest since many of my friends weren't yet investing. But I decided to invest $10k and wired the money.

After the wire, I had no idea what happens next. (Answer: you generally get monthly investor updates, but not always. The most helpful things for founders are for angels to provide intros & then get out of the way)

Since my first investment, I've learned a lot about how the general angel ecosystem works. First, angels can invest in a variety of ways. 1) You can be a true angel & invest your own capital (that's what I do); 2) You can be a fund manager who raises a solo fund;

3) You can use scout funds; 4) You can get other people to invest alongside you as a syndicate. As a founder & investor, I generally prefer true angels who are investing their own capital bc they have the most skin in the game.

Personally I'm currently just investing my own money because I have a super busy job & don't want to feel huge responsibility for managing outside capital. Also, I can make very quick decisions & don't need to ask anyone for permission. However, this means my checks are small.

Once you decide how much you want to invest (individual angels often invest between $5k and $100k), then the next part is about picking and winning deals. The reason that it can often be hard to get on cap tables with $5k checks is that there's lots of legal work involved.

To get into deals, you generally have to reach out to founders directly & tell them that you'd be interested in investing if they're ever raise OR you might be reached out to by a VC who's leading the deal.

As I describe it - there are 2 types of deals. Those that have raised from an institutional VC & those that have not. My investment mix is about 50/50. It's always a balance bc if a startup hasn't raised institutional, it might be more risky.

Pre-VC deals are more fun for me because I can often help 'make' the deal by providing the founders lots of intros with top funds. I inadvertently created a big network with investors while networking into VC.

Another thing is thinking through your personal branding and WHY founders should let you invest. As I mentioned, it's expensive & complicated to have angels on your cap table so angels need to provide a clear value proposition to founders.

One of the best ways is to become an expert in a certain field or subject matter area, so you become a go-to person that founders want to get feedback from. For me this has naturally been fintech. Invest in what you know.

Also, only do angel investing for FUN and not to make a quick buck. This is a LONG TERM process & you might not see any returns for a decade. You should feel comfortable if your investments go to 0. I can get quick returns in stocks, but I love helping founders & can't stay away.

Additionally, both founders & investors should continue to invite women to their cap tables. Deal flow is gold, and most networks are still almost exclusively men. Gender diversity on cap tables will create more diverse companies in the future & help spread the wealth.

I could probably go on for another hour, but that's enough tips for today!