Seed Capital From Angel Investors: Bob Aholt, Pasadena Angels (Part 2)

By guest authors Irina Patterson and Candice Arnold

Irina: So you have other angel groups in the Los Angeles area?

Bob: Yes. There’s Tech Coast Angels and they’re, like I said, a lot like us, but they’ve broken down into chapters so they have a chapter in San Diego, one in L.A., and one in Northern California. So instead of having one group of 100 people, they have five groups and they have actually more members if you total up the five chapters. But we come together at least once a month and meet as a whole group, whereas they do things a on a chapter basis. There are a couple of other angel groups that are now in L.A., such as Maverick Angels, and Keiretsu Forum I believe, has a chapter here as well. So, from an entrepreneur’s perspective, things are looking up.

Irina: Is there any particular success story that you would like to share?

Bob: I’ve been investing for only about four or five years, so I’m actually pretty much of a newbie to this. So, I’ve only had one successful exit, with a company called Option Ease. They made stock software for valuing companies’ internal options. Some Pasadena Angels exited that company and some other Angels stayed on and contributed to the follow-on rounds. That was a nice exit. We were able to get out rather quickly and make some money. There have been some success stories, but the story’s the same with private equity and venture capitalists and angels over the past, say, ten years since the dot-com bubble burst; the exits haven’t been coming like we had hoped, that’s for sure.

Irina: So, what is the best source of your flow?

Bob: We have a website, PasadenaAngels.com, where we push entrepreneurs to have a formal inlet on our channel. So, there’s a little button on our website that says “Apply for funding” and it takes you through a process where you can pitch your business plan. But just going to the website is the act of getting into the funnel; however, almost all of us, all 100 members, are out doing a lot of work around the community. So, for example, I was at the local community college last night on a panel talking about how entrepreneurs get early-stage funding. And so from that, we’ll push people to the website and try and generate some buzz around the community through more interpersonal action and being on panels and showing up at events rather than just trying to hype our website.

Irina: So, all entrepreneurs have to come in through your website?

Bob: Yes. That’s the formal entrance. I was talking to three or four gentlemen last night and they kept wanting to hand me their business plans. And I go, “Okay, great, I’ll take them, but this doesn’t get you into the the Pasadena Angels process. You have to go to the Pasadena Angels website and apply.”

Irina: And also, probably, the members bring in some companies that they know, right?

Bob: Absolutely. In fact, another one of the questions floating around is: What’s more effective? And if you can get a sponsor inside of the Angels to say, “Hey, I’ve talked to these guys and I’ve mentored them and they seem like they’re the real deal,” that certainly means a lot to our membership. And we’ll give those companies a little longer look usually, if they’re sponsored internally by another Angel. But to be clear, those companies do have to go through the website, as well. They end up putting their business plans on the website, too.

What we’re trying to do is develop some longer range processes so, hopefully, we can develop some feedback loops and start looking at things that worked and didn’t work. And the start of that is capturing all the information in a consistent manner. That’s my technology background showing through.

This segment is part 2 in the series : Seed Capital From Angel Investors: Bob Aholt, Pasadena Angels
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