A few weeks ago I was invited to attend a CommonAngels breakfast. CommonAngels is a Boston based group of angel investors and these breakfasts take place every six weeks to hear presentations from entrepreneurs looking to have their ideas funded. Members of CommonAngels are allowed to bring a guest along and I was lucky to be invited.
CommonAngels is composed of 70 private investors and several dozen limited partners in two co-investment funds. This group is fairly unique in that they have a small permanent staff of three people who manage the group, taking care of the putting the breakfasts together, managing the deal-flow, due diligence, board memberships, and so on.
This group is self selected. To join, you need to fulfill certain criteria and go through an approval process. Since its inception in 1998, CommonAngels has funded 33 companies with over $37 million from CommonAngels and over $100 million from co-investors. Rounds are typically in the half to one million dollar range, but can go higher.
They take a very hands on approach to the funding process, and will only fund companies in their areas of expertise. Entrepreneurs present their plans at these breakfasts where the group asks questions and critique the plan.
If a company was funded by CommonAngels and needs bridge or continuation funding, they can present again and the board member will take part in the presentation. If there is interest in funding the company, the group puts together a due diligence committee to dig deeper into the company and the plan. If the company is funded, the group is present on the board.
What is interesting here is that this group is very hands on and involves itself very intimately in the company and its development, rather than just “throwing money over the wall.”
8 comments so far
10:12 AM PT
The CEO members are highly respected and established entrepreneurs, although some of them are retired or should be.
Common Angels is the worst of both worlds– VC pain, angel dollar amounts.
They want to act like big boy VCs, be a pain in the ass, and gain control while only being able to fund a limited amount.
Don’t waste your time.
11:02 AM PT
I agree with first comment. CA suck. I know of a few companies who received money and hated them. They also don’t know much about web 2.0 space.
2:17 PM PT
I have taken money from CommonAngels and found them to be great. Back in 2004/05 the VC’s were not investing in anything and it was only groups like CA that were getting it done for early stage companies. The terms were very easy and they have backed us up all the way through.
2:41 PM PT
Don’t know much about Web 2.0? They are probably one of the few in Boston who do. They’ve backed Skyhook Wireless, Carbonite, Nimbit, PermissionTV and most recently Xconomy. I’ve presented to them, and what you have to expect is to know your business model. Don’t think you can just throw around a lot of buzzwords and get by like you can with some investors. They’re all operating people and can smell BS walking in the door. We didn’t have our financials down well enough and knew it; comments we got were tough but professional and deserved.
11:58 PM PT
I’ll agree with the above commenters: I’ve talked to a few East Coast folks who have dealt with them, and the general consensus is: don’t. Way too much work/meddling/overhead for what is is from an Entrepreneur’s PoV.
6:44 AM PT
We met with 80% of the East Coast VCs, including Common Angels (they are VCs despite what they claim). There is no magic here - although I was hoping to meet someone that I thought was fantastic, that just didn’t happen. It was my own ignorance that built these guys up.
We all know the game in software, Web 2.0, tech etc. Some hit, a lot miss - these guys are just the byproducts of some that hit. I have worked for many guys that are very wealthy, and I kept thinking to myself “what am I missing here, this guy doesn’t seem any different, doesn’t have any thing special, no special skills.” Hell, maybe my employees thought the same thing about me.
It takes a lot to make a great company, a single purpose, focus, customers, employees, etc. It doesn’t take great VCs, no matter how much “magic dust” about the group they like to spread, you just need their money, and if you can get it outside their system you will be better off.
6:53 AM PT
You got totally sold didn’t you? If I take you to dinner and show you my good side, you just might want to marry me! But wait until you see my past.
Common Angels are the worst. I know a bunch of the Common Angels guys, primarily their leadership, and let me tell you, they’re the biggest knuckleheads in the city. Total wankers. They just don’t have a clue. And, I would say that if you looked at their track record you’d scratch your head. Really, ask around. They blow, hard.
7:09 AM PT
To SHAMELESS - let me guess, you presented your model to them, they gave you some harsh but probably much-needed criticism and they didn’t fund you.
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