Why angel investors are like Pokémon (Oversubscribed Weekly #25)

Max here. Sorry we missed you last week—Mike has been traveling the country giving talks about fundraising for AWS, so we’ve been a little busier than usual!

Angel investors are like Pokémon.

I saw Detective Pikachu over the weekend, and couldn’t believe how good it was. In fact, it may have overtaken The Proposal as my favorite Ryan Reynolds movie.

(Disclaimer: The Proposal is not actually my favorite Ryan Reynolds movie. Do not see The Proposal.)

So I’m thrilled to be able to link you this week to this incredible tweetstorm from the equally incredibly-named Avichal Garg of Electric Capital comparing angel investors to Pokémon.

(Also: Electric Capital… and Pikachu is an electric Pokémon… these can’t just be coincidences, folks!)

1/ Like Pokémon, angel investors have a natural evolutionary path. Founders who understand the evolution of angels can construct a better team around the company. A quick thread on my observations and how founders should stack their team ?

— Avichal Garg (Electric Capital) ⚡ (@avichal) May 26, 2019

I’d highly recommend reading the entire thread, but one important takeaway is that what Avichal calls “Level One angels”—those who are just starting out, often current or recent founders—can, counterintuitively, be the most helpful.

Why? They tend to have fewer investments and are often more eager to prove themselves.

This is nothing against the more famous angels—there’s a reason someone like Naval Ravikant has such a great reputation. And if Naval wants to invest in your company, I certainly wouldn’t turn him down. But he’s made a gajillion investments, so with someone like him, you’re more likely to be a small fish in a big pond.

Personally, the most helpful angel investor I had was a guy named Ian Rountree, who invested in my company when we, and him, were just starting out. He was one of our smaller investors and didn’t have much of a reputation when we first met him. But he was always there for us when we needed him with advice, connections, or just a friendly ear.

We had some more well-known angels on board too, and I have nothing bad to say about any of them, but they just weren’t as accessible or hands-on as Ian was.

(By the way, Ian has since started his own firm, Cantos Ventures, and made a bunch more awesome investments, so he’s probably no longer a Tier One angel.)

So think about it the next time you’re fundraising. Which of these Pokémon would you rather have as your angel investor? The answer might surprise you.

Enjoy this? Get Oversubscribed in your inbox every Thursday.