Today I am pre-screening new deals coming into my angel group. I find that when entrepreneurs "see how the sausage is made" is helps them design their own documents and presentations to get through the gauntlet.
Some samples from today’s pre-screening (anonymized):
- Deal 1 – Failed to frontload any credibility in their application (just-another-idea). Used 1st person in professional documents instead of 3rd person (sends a signal of unprofessional). Sounds like they are generating revenue (good!) but I am not sure from their opening ext. Time spent: 1 minute. Decision: decline.
- Deal 2 – Grammar error on first line (signal=unprofessional). Opening language is full of buzz words dressing up what they do without actually telling me what benefits they deliver, to whom, and for how much. Time spent: 30 seconds. Decision: decline.
- Deal 3 – Far away. Included a video so I didn’t have too read anything :). Video did an excellent job of explaining problem, their benefits. I realized one of my angels is a potential customer. I stopped listening right there and referred it on to him. Time: 1.5 min. Decision: bounce by a member with domain expertise.
- Deal 4 – "Manufacturing of high quality low cost recycled clear [substance] as a competitive alternative to the virgin material." Use of such geek speak turns off anyone who isn’t your kind of geek. I may very well have these kinds of geeks in my angel group – but they aren’t screening, I am. If I can’t understand your idea, I can’t figure out who to send your deal to. Note the lack of commas (unprofessional). Located close by so that’s good. Time: 1 minute. Decision: decline but point to resources and people that can help in their geography.
- Deal 5 – Prototype software business that looks like it is targeting an industry several of our members could be customers of (good!). However, pre-money valuation is $2 million for a prototype-level product with no customers and a management team that looks like they have zero startup experience. Time spent: 1 min. Decision: I will chat with them via phone for 20 min.
- Deal 6 – Outside the industries we know well (listed on our website) About 3 hours drive from us (too far! As listed on our website). Included av video so I watched first and then scanned doc. Time spent: 1 minute. Decision: Decline.
- Deal 7 – Outside our domain. Outside our geography. Too early. Time spent: 30 seconds. Decision: decline.