[Quotes] An Open Letter To Hong Kong Angel Investors

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This is an open letter to angel investors in Hong Kong, and is part of a two-part series. The next part will include advice from angel investors and experienced entrepreneurs to new entrepreneurs raising funds for the first time.

Don’t Be A Jerk

as Jonathan Buford, founder of Makible, a hardware startup focused on 3D printing and innovative manufacturing techniques, puts it, “You will get a bad reputation quickly and no one will come to you with good deals.”



Communicate Clearly

“Investors should make a decision quickly and articulate their decision clearly. If the decision is to not invest, they should let the startup come back at some point in the future with the concerns addressed.”



Invest In People Before Businesses

“Angel investors in HK don’t seem to have the same long term perspective that investors in Silicon Valley have,” says Asif Ghafoor of Spacious, an online real estate portal.



Take A Reasonable Stake

“Trying to squeeze early stage founders can backfire spectacularly when founders realise they are working 24×7 for a bad deal,” Ghafoor says. “There’s nothing to keep them from simply walking away and starting again, and then the investment is worth nothing.”



Specialize

“Hong Kong has a gap when it comes to tech startups fundraising in the range of $500K to $5M USD,” says Raphael Cohen, co-founder of the last-minute hotel deals app HotelQuickly. “We got most of our investment from Singaporean and European angels. Although Hong Kong is a major financial hub, few investors are looking into the tech startups sector.”



Accurately Define Failure

Lean startup theory, as recently popularized by Eric Ries in his book The Lean Startup, shows how it is precisely a process of experimentation and changing track to follow the best opportunities that leads to better companies, and better investments.



Don’t Judge A Book By Its Cover

“A lot of entrepreneurs come from different countries and may not know the local custom or culture.” Investors, do you want to pass up the next Facebook, Twitter, or Pinterest based on superficialities?



Bring More Than Money To The Table

All other things being equal, it is safer to invest in a team that has been successful before. Angel investors can negotiate better terms, attract the best investments, and increase the value of those investments by providing more value to the startups they invest in than money.


More, please visit
http://www.forbes.com/sites/joshsteimle/2014/02/19/an-open-letter-to-hong-kong-angel-investors/

Joshua Steimle is a Hong Kong based entrepreneur writing about startups, entrepreneurship, and online marketing.