Investor Matching is Bullshit; Helping Startups Means Ending the Predators

Lots of Investor Matching / Investor Finding platforms… Funded, AngelList… besides, your city likely has an Angel Group, or three. You probably have a Startup Hub where you can pay to be part of the network and book office hours with investors.

They claim to get you databases of investors, lists to email, or perhaps even connect you with the ideal potential investors. Often, founders, it’s at your expense.

Think about that a moment: the capital charging the entrepreneur who needs it (who is taking all the risk) for the slim chance of getting the capital needed… to pay the capital for the privilege of talking to them.

This needs to stop. The “matching” is almost always junk. Investors therein doing little more than raising their hand 🤚 so the provider can sell startups on the idea that these people are exclusive, inaccessible, and available “here,” for a fee.

I find, for whatever it’s worth, that the real challenge is a lot of wealthy people, HNWs, and self-proclaimed Angels, *want* to be part of the startup ecosystem and want to be perceived as supporting it and investing in entrepreneurs; but they aren’t… much. They don’t have experience in startups. They invested in one, maybe two, startups and claim to be Angels; hey show up at demo days and events.

The problem with that is that they clearly aren’t capable startup investors. *They* aren’t Angel Investors. They don’t have 10% of their disposable, invested wealth, freely available to *lose* by meaningfully (more than a $10k check) allocating it to 10+ startups (most of which will fail). They aren’t willing to invest in startups, they’re looking for revenue bearing, safe, new businesses.

*This* is what causes the mismatches. This is what misleads and frankly, rightly, angers founders.

The cries of mismatch or anger from founders who try it, more often than not, is echoed by everyone tired of having meetings with so-called investors, only to find they have crappy advice, no experience, and aren’t actually investing much (if at all).

A solution? A challenge to the platform providers, the investor networks, and the Angel Groups — TRANSPARENCY: Data about investors’ portfolio. SHOW founders 💞

• Show founders that the investors are in many, similar-sector startups
• Show founders that they invest meaningfully, in startups, and hold more than 1 or two
• Ensure founders aren’t getting crappy advice from business investors who have no business in startups
• Help founders avoid the wasted time by actually matching startups with genuine investors; do due diligence not so much on the startups (at a seed stage no less) but on the people joining you saying they’ll invest

In entrepreneurship, on behalf of startups and founders, you’re not helping because you try; if you don’t have experience and intention consistent with what startups are and do, you’re causing problems and need to get out of the way.

Know of a GOOD network? A good resource for founders?