Hot Smart Rich with Maggie Sellers Reum - Maggie Sellers On How To Start Angel Investing (Her Secrets Exposed)

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Starting point is 00:01:12 Hi, guys. Welcome back to another episode of Hot Smart Rich, the podcast. Thank you so much for tuning in to this episode, every episode. If it's your first, if it's something that you've listened to consistently over the past few weeks, I am so grateful that you're here. This has been such an overwhelming experience for me. I feel like naturally I'm good at this, but there's also a lot about it that I'm naturally getting used to because it feels a little awkward. I have been told that I could literally talk to a dead moose, yet when I try to talk to a dead moose that's literally on the wall in Montana right now, it is so freaking hard.

Starting point is 00:01:53 And so I have to be honest, this is not the first time I have tried to record this episode. I tried to record it with my sister on Zoom. and when I listen back to it, it just didn't feel like it was hitting. And I guess that's what happens when you put out one podcast episode and you get on to the top business charts on Spotify in your first week. First of all, that is only possible because of you guys. That is only possible because you actually want to listen to me, which I feel so grateful to be able to say.

Starting point is 00:02:25 But it puts on so much pressure. And that's okay. Like I can thrive under pressure. I've actually been better at pressure than I have been when I have a lot of time. I was always like that in school. I was always better at having to do something last minute than having so many weeks to prepare. I was like one of those people that would just always leave it to the last minute. But I woke up in disbelief when I found out that we had made the top charts on Spotify.

Starting point is 00:02:52 That was something that I put onto my vision board for the entire year. I had zero idea that it was possible in our first week. What that has meant for future weeks is this sense of urgency and this sense of a things having to be perfect. And things are just not going to be perfect. I'm still getting to learn you guys. I'm still getting to learn a new format. I posted this a year ago that said something like your first anything will be bad, but you can't get to your 95th to be perfect if you're not willing to make your first one bad.

Starting point is 00:03:25 And I was anticipating the first 10 being bad at least. And so for it to reach the charts, on the one hand, I'm so grateful. On the other hand, I'm so scared. I hope that while I learn and evolve, you guys stick with me and give me all the feedback. So that being said, if I can ask one favor, it would be to rate, review, comment, and share an episode that means something to you with a friend. That is the way that this show gets better. The better guests that I can have on, the more honest conversations I'm going to have

Starting point is 00:03:54 with you guys. So please, if you can, rate, review, comments. I never thought I would be one of those people that would say that, but here we are. I am going to start off this episode, actually just taking a little spritz of this Més-Luie Marie number four, which is a perfume that I love from Sephora. Somebody actually got this for me and I brought it as one of my perfumes. I'm really big on stepping into the energy that you want to exude. And today's episode is a big one.

Starting point is 00:04:23 It's actually how I created a platform off of TikTok. It's the ins and outs, the angel investing 101 that everybody has been asking for for honestly years. And I've obviously touched on angel investing. It's like I said, how I created my platform. But part of it, the hesitation to really dive deep into this topic when I only had a short form platform was it is really confusing and it's complex. And depending on if you're a founder, if you're already an angel investor, if you're an aspiring, or if you're just startup curious, like I know a lot of the people that, are listening to this are, there are so many different stages and different levels think of it

Starting point is 00:05:02 that you could get to to understand angel investing. So just a little disclaimer, this episode is not financial advice, especially from somebody who does not have a financially trained background. I do not hold a CFA. I did not go to an investment bank. I did not work in private equity. I am not a former founder that has a multimillion dollar exit. I am your average marketing manager that had turned a passion and an interest into believing in companies that I thought should exist and didn't and have turned that into a professional platform and career. Today is the day I feel like I finally, even though this episode was planned, this is just kismet from the universe.

Starting point is 00:05:42 Today is the day I finally feel ready to do this because what you look at in investing, especially because outcomes are like seven to 10 years down the line is a track record. And a track record can mean a lot of things. It can mean that a startup that you invested in, in at an early stage actually has a liquidity event. So they go and they get listed on the public stock market or they get sold to a holding company or they get sold to an acquirer. But if you don't have that because you only have been investing for a few years,

Starting point is 00:06:10 you have something like markups or on paper you've made good investments and you're creating a track record for yourself. And I have a very exciting announcement that happened just yesterday, even though I technically have known about it for a few months now. my portfolio company, Lara, that I made an angel investment into, and I actually brought Van Terra Ventures, which I'm an advisor and a venture partner into, they just announced that they have raised a $26 million series B. The company was founded by Rachel Blank, who actually was a previous VC. She is like the ideal girl on paper, literally, and actually in real life. Honestly,

Starting point is 00:06:49 this just doesn't happen that often. And so to see a solo female founder and some something that I believed in without having this technical trained background and see where it's at from where we started at. It's just like the motivation and the inspiration that I even needed to record this. I'm really excited to dive in. Today we're going to talk all about Angel Investing 101. One of the things that I've learned to make this the most natural way is asking you guys a bunch of things on my story so that I can answer very specific questions. So some of the things that we're going to get into today is like, what is Angel investing? How I personally got into it. And this is really great for anybody who just wants to think creatively because you also don't have a traditional

Starting point is 00:07:27 background. Some of the myths of angel investing, I really want to talk about how you find deals. Is it right for you? I want you to leave this episode, maybe not having a decision if it's right for you, but at least understanding how you can start to think about it being right for you. I want to talk really quickly just about some tactical tactical things. Like is there a contract and then your role as an angel investor? So we're going to try to cover a lot. I'm going to aim to make this episode like 30 minutes, I think, because again, we can always do another one, but I don't want to blabber on. But here's another disclaimer to get started. I do not want you to listen to this if your goal is to make money, which is probably the worst advice you've ever heard about investing because you

Starting point is 00:08:09 invest to make money. Anybody that tells you that you're going to become a multimillionaire off of angel investing is just straight up lying to you. And I'm going to break down why. So what is angel investing. Angel investing, I would say, is probably one of the riskiest asset classes or forms of investment. But why do people do it then? And I think about myself as an angel investor in this way, like I've said, is to back things that I think should exist and don't and help them come into the marketplace. It is also an extremely illiquid form of capital, which means that when you invest into the stock market, you can decide, or if your circumstances or situation changes, you can decide to pull your money out. You cannot do that as an angel investor. Your money is locked up. And like I've said before,

Starting point is 00:08:55 it is over a long period of time. If I think about what I have done in the last five or 10 years, I'm 32 now. So being 22 years old, like that is the average life cycle of an angel investment. Your financial situation could change. So I always look at angel investing as money that you are not banking on for the next 10 years or ever. Like I honestly kind of say goodbye to that money from my financial perspective. And I'm going to talk about all the other reasons why people get involved. But angel investing, like, why would anybody do this then? It is really a belief. It is something that you think of yourself as like the tooth fairy. You're like you are going around and giving money to people that you think need to have it to be

Starting point is 00:09:39 able to bring their idea into the marketplace. And there is some sort of a contract involved, which we'll get into later, although it's not your typical contract, that gives particular for both the founder and for the investor to make sure that you're not just investing as charity, like you're doing it to get a financial outcome if you can. But I really want you to detach from the idea that this is about making money because anybody that thinks that way should look at a different form of investing. There is a big difference between angel investing, venture capital and private equity. And we're going to really focus on angel investing versus venture capital because angel investing is really an individual sport. It's something that.

Starting point is 00:10:19 you do to invest your own money. Whereas venture capital is a professional investment group that is investing on behalf of other people's money. So they are pooling money from investors and investing into companies in a diversified portfolio as a profession, whereas angel investing is typically done as an individual exercise. You can call it a passion, you can call it a hobby. There's a little bit of nuance to that, whereas just to be very clear up front, I'm an angel investor. So I invest my own Let's just talk about money for a second. I invest $5,000 to $15,000 as an individual check. And we also run something called HSR Ventures, which is an Angel Syndicate. So we then invest $100 to $500,000 into the same type of company, early stage, but this time we are pulling

Starting point is 00:11:10 money from different investors into one investment group onto a cap table, which is essentially just a fancy way for founders to be able to keep track of who owns ownership in their company. And that is exactly what Angel investing is. It is ownership. You are giving a founder capital to own a piece of that company. And it always makes me laugh because I always hear people, like, especially at fancy places, people are like, oh, I'm an owner of that company. And then you drill down and you ask them more questions. And they invested at like the preseed of the seed, a nominal amount. Still amazing that you have great gut instincts. if the company ends up being something, because that's usually why people brag.

Starting point is 00:11:49 But it definitely doesn't mean you are the owner of the company, but you are an owner. And that is why when you are a founder, or if you are a founder listening to this, it is so important to take money only from people that you can anticipate being in business with for the next 10 years because it is harder to get an investor off of your cap table than it is to get a divorce. So you are signing up for a long-term arrangement where you as the angel investor are giving a founder money to go and bring their crazy idea into fruition. And the word here is crazy. Because how investing really got its start was on bringing very contrarian ideas to the marketplace

Starting point is 00:12:29 that just couldn't bring a profit at the same time. They were such innovative concepts that the idea that consumers were ready for it right then and there and there wasn't testing was really the reason why founders were having to go to investors in the first place to fund their ideas. And I think the word investing has diluted itself or become less important of a meaning based on the types of investing that there is. Even the difference between tech investing into companies that you know of like on your phone, like Canva or Want Locker or Uber versus into companies that are consumer like Set Active you might wear or Bala you might wear or Missouri as a jewelry band.

Starting point is 00:13:12 the economics of how those companies make money is so fundamentally different, which is why the type of investing that you need to do is also fundamentally different. Like I said, lots of nuances. I'm going to take a pause because I don't want to go down rabbit holes that we're all not ready for yet. This is like your angel investing 101, and we're going to bring it back to the basics. Why did I start this section off by saying don't do it if your goal is to make money? The sad reality is that nine out of every 10 startups will not make it. And you just have to be okay with that. There are angel investments that I have made where I thought it was a great idea. The great founder, second time founder, who had sold their company for like 150 million. I'm thinking of one in particular. And I put in a

Starting point is 00:13:58 small angel check. It was actually an AI education platform. So it was like giving parents that didn't have the same resources to send their kids to like a fancy school and their kids were like coming home and watching Miss Rachel, which is no shade to Ms. Rachel, but it was more like a one-to-one education platform to really help them on their specific development. And literally like seven months after I gave her money, I get an email that she's just not going to be continuing on with the company. That happens. There's other angel investments that I've made like Laura where it's like, wow, you can really see your progression. But the reason that founders even want your capital at the beginning is because there is a need for capital. And without runway,

Starting point is 00:14:38 without capital, ideas and businesses go to die. But very quickly, there is a switch that happens when the company has progressed and they've maybe turned profitable or there's a ton of interest from more professional groups that can deploy more capital, venture capitalists. And cash no longer becomes the most important resource, and that's in quotations, because cash is obviously king, cash is the most important. But equity becomes extremely important to them because that is their ownership perspective that they will get to make a large payout one day off of. That's where you see founders that are like, we sold our company for 400 million and you think that they have 400 million. Well, it really depends how much of their company they gave up in

Starting point is 00:15:21 exchange for cash as they were building their business. And this is such a great segue into how I got into it. And I'm sure the tech bro, if they listen to this, sweetie, this is not for you. but they are going to pick me apart on Reddit or whatever threads they use X, I refuse to go on there. Because I would actually describe my entry into angel investing in a completely different way than most would. Like I said, I am the anti-archotype of the angel investor. You're typically looking at the circles of like the people that live in San Francisco and New York. They were invest in bankers or they were in private equity or their former founders with a multimillion dollar exit. and I am just your average marketing girl who understood the power of ownership and equity at

Starting point is 00:16:07 startups as an employee. And what I'm talking about is something called an employee stock option plan. And I can say proudly that I have never worked at a startup that I did not own a piece of the company with through an ESOP program. So instead of just getting, let's just use easy numbers, let's say $100,000 as compensation, salary plus bonus, I would drop. my salary down and then negotiate for a piece of equity vested over a period of time. So that's like how many years you actually have to work for it to be able to say that it's yours.

Starting point is 00:16:40 I loved that because I was that employee that worked my ass off. I was constantly going above and beyond. At one startup, I literally became best friends with like the head of finance because we would be in the office until like 11 p.m. every single night. And I probably didn't have to do that, but that's just the way that I work. So having a piece of ownership felt like it was worth it versus just knowing that I was like clocking in and clocking out every single day. So I would actually argue especially because the first startup that I worked at, I was so lucky I have to shout out Matt Corrin. Like I worked for him directly during the last few months of my tenure at this company called Freshie.

Starting point is 00:17:19 And during that time, we went public. And I remember like staring at Matt as he was on the stage at the TSX, the Toronto Stock Exchange. So I remember looking at him and being like, oh, this is the goal of every single company and what they want to do one day, which is like to essentially go from building it yourself with your employees to go to like having a larger ownership pool. And that's really what an IPO or an acquisition does. I remember we after we left the stock the stock exchange, we went back to the office. And Matt offered to take me for a walk. And we were walking and I was obsessed with gum at this time. And so I used to buy like five packs of gum.

Starting point is 00:17:56 and I put it down on the counter and I tried to go pay for it. He's like, I got it. Trust me, like, I just made some money. I got it. And it was in that moment where I was like, oh, that's liquidity. Like, especially when you have a large ownership perspective, like, this is a big deal. This is like how you make generational wealth. So from there, I left.

Starting point is 00:18:16 I went and worked at other startups. And the real pivotal moment came when I had worked at a very high-growth startup. We had raised $120 million. This is the reason I even moved to Los Angeles. And the former president of the company, after two years of both of us working there, very intimately, decided to leave and go on to his next venture. And he asked me one day to go for dinner, which was not abnormal. So we leave, we go for dinner. And during dinner, he tells me that he's leaving and he's starting his new company.

Starting point is 00:18:46 And he asks me if I'm going to go with him and become the vice president of marketing. And I felt like I had done that role, even though my title was like direct. of brand marketing or head of brand marketing underneath our CMO. I had deployed a $18 million budget. I was responsible or helped be responsible for all out of home, influencer, geographic expansion, product expansion, retail launches. And I was looking for the next chapter. And I wasn't exactly sure what that was at that moment, but I knew it wasn't going back into like a pre-seed company or an idea and building it from scratch as the VP of marketing. I think I also wasn't super passionate about the idea, but that's a different story.

Starting point is 00:19:28 So I decided, and that's not true, I was passionate about the idea, but I wasn't passionate enough to give it everything that I had and to really go and do what I do, which is act like an owner as a VP of marketing for this person in particular, and good thing I didn't. I decided to negotiate and try to become my first advisor to a startup in exchange for equity to essentially do a lot of the roles and responsibilities that he wanted from me, but not full-time. So I said that I would help him hire his head of marketing, which I ended up doing, and she crashed. I would help him figure out how to put influencers into the company as investors and advisory partners through equity. So structuring all the deals, putting together the actual scope of work that they would be responsible for,

Starting point is 00:20:15 roles and responsibilities, and a bunch of other aspects of the company, including raising money, and all the grunt work that you do wearing so many different hats as an advisor. He ended up going for it. I had no clue what I was doing. And when I, fast forward years later, found out what the actual structure of the agreement was for how much I was given in terms of the percentage of equity, it was really disheartening. I have since decided to no longer be involved with this company. I actually gave up all of my equity based on how unfortunate this. was of a situation of being taken advantage of. And I have no beef with anybody, but I just,

Starting point is 00:20:56 in this stage of my life, can choose who I spend time with. And it's not a company nor a person that I'm interested in spending time with. And that was the best decision for me. What it taught me was the fundamentals of how to look at deals and how to make decisions based on what I believe should exist and doesn't currently. And I think that's a skill that for anybody that's listening, wants to be an angel investor. It's like, how do you know which ones to do? And it's like, think about it if you were starting a job there. How would you evaluate the CEO? How would you evaluate the culture? How would you evaluate the market? Who are their biggest competitors? Like, get curious. That is another episode that we're going to do, but I can't help myself and I just have to spill all the secrets right

Starting point is 00:21:39 away. That all being said, advising companies for equity, although it wasn't investing my money, it was a big investment of my time. And this is what we call sweat equity, literally putting in the work to get a piece of ownership. And that led me to be comfortable with the idea of parting with money. And this is also such an interesting thing as you get older. Like now my most precious resource is my time unless it was like an insanely amazing idea that I was so passionate about. Like I don't know if I would be open as much to advising companies now. Like I'm much more interested in investing and having more of a hands off approach and not having to put in the same amount of work that I once did because I'm just in a different place

Starting point is 00:22:26 of my life where yes, my priority is obviously my business, HSR Ventures, HSR Media, this podcast now. but I'm also in a very healthy relationship where we're thinking about marriage and kids and my time is my most important resource. But for anybody that's listening that really wants to get involved, like the best learning that I did was through my time. And if you don't have the capital to invest, start with one company,

Starting point is 00:22:54 figuring out what your superpower is, where can you add value? And then it's the same way when you're trying to get onto a cap table as an investor. it's similar with advising. It's like you're having to convince the founder to let you involved in their baby and what are you going to be able to offer them other than just capital because if that's not what you have, then you have to get very creative over what that is. I have since become an angel investor.

Starting point is 00:23:20 Like I said before, we're deploying $5 to $15,000 into companies. And to some, that is not a lot. We're going to get into that later. But to me, it's perfect based on my goals with investing. I've also spent time in corporate VC. So I actually launched a corporate venture arm for a record label where we would invest off of the balance sheet of the record label into mostly music tech startups, but also startups that we felt aligned and could offer value to the roster of artists that was on the label. And that was an amazing opportunity to really understand professional investing. And now, like I said, we run a syndicate.

Starting point is 00:23:53 So this is what I argue is probably the best if you are looking for angel investing to be part of your portfolio, but you can't make it your full-time thing. part of being a good investor is just a volume game and understanding how many deals there are out there and really making sure that you have eyes on everything, which is why when you're being evaluated as an investor, people are asking you questions, like, how do you source deals? What are your like areas that you find you're getting proprietary deal flow that I couldn't find somewhere else? So a syndicate is a great way to get exposure to deals, to get exposure to companies. And we have a lower guardrail from a minimum checks.

Starting point is 00:24:31 it's $5,000. Usually our investors are investing anywhere from $20,000 to $100,000 per deal. That's obviously not the requirement. It's as low as $5,000 to try to get more people involved. And it is a really great way where you can still be learning, still have something that you're involved in, but it's not something that you're solely responsible for day in and day out. I'm going to talk a little bit more about our syndicate.

Starting point is 00:24:53 One of my worst qualities is that I am the worst plug of things. I think it's creative anxiety or I don't know what it is. like, I am just the worst at plugging things that we're doing. So that stops here. HsR. Ventures Syndicate is really an opportunity for women specifically to get involved and men in backing companies that help women evolve throughout their role in society. So things that we're really focused on are baby pets, aging, women's health with a big

Starting point is 00:25:21 focus right now on fertility and egg freezing and menopause. We're looking at things that help women just take off the pressure. from every role that they wear, like primary house manager, primary caregiver. Maybe they're not the only breadwinner in the family, but they have financial independence because they work outside of the home, yet they have a full-time job also at the home. Those are the companies that we're trying to find to help those types of women thrive and not just survive. I guess the metrics will let me know if I'm doing a good job based on drop-off, but I am going

Starting point is 00:25:57 to spray some more of this perfume on me because I really feel like I'm stepping into my hot smart rich power and the first half of this episode was pretty good. Okay, myths. You have to be rich to do it. Not true. I do not know why this is such a myth. You do not have to have a multi-million dollar fortune. And I think that's why my story has resonated so much with TikTok because I don't have a founder exit. Like I am not the archetype of the person that is an angel investor. There are some guardrails and I'm not going to bore you because like this is the hot smart rich podcast. We're going to to put those in the show notes so that you can see from the SEC if you fit the requirements to start angel investing. But there are no guardrails to start advising. So start there if you don't

Starting point is 00:26:40 fit the requirements yet. You do not have to invest $50,000. I think, again, it's all based on what your reasons are for doing it. We're going to get into that a little bit later. You can do it well on the side. Like I kind of just answered, I actually don't think that you can do it that well on the side unless this, if you work in an industry and you are an expert at, let's say you work in pet pharma and you know everything about pet pharma, you know the acquirers, you know the types of channels to acquire customers, you know the sales reps that the companies to get food into, like you just know everything about pet pharma. You can invest in pet pharma very well on the side because you know the industry in and out. And part of when you're deligencing a deal in angel investing is getting

Starting point is 00:27:25 very curious and trying to understand the market, the industry, the competitors, the players, the potential acquirers, and you just don't have the time to do that when you work a full-time job. However, if it is your full-time job and it's synergistic and you think that it's also a weight space or that there's an actual gap in the market, that is the perfect company for you to invest in based on your expertise. This last one is definitely a podcast episode in and of itself, and I have to think without calling out brands that have confidentially shared with me their information, how I can position this in a way that is educational, because the moral of the story is that a good brand does not mean that it is a good investment.

Starting point is 00:28:08 There can be amazing consumer brands that you use that would be a horrible investment. Investment is a word that is used as a way to make money on your money. There is maybe kumbaya reasons that you want to back a great brand. Like you love the founder. You think that it should exist. But again, it doesn't mean that it's a good investment financially. It could be a good investment for other reasons, but we're talking financial. So I think a huge misconception is like, let's say your favorite brand in the world is hot smart rich.

Starting point is 00:28:42 And I offer everybody the opportunity to invest in hot smart rich, which is not going to happen. unless you know the market, the potential acquirers, the way that we make money, like our unit economics, like all of the actual ins and outs of hot smart rich, the business, it does not mean that it is a good financial investment. Unless you ask the right questions, you know the market and you feel really comfortable. So we'll do a whole other podcast about that, but just be weary. When you see a good brand name, the brand that you're obsessed with, think of that. beauty brand, the fashion brand, the whatever brand. It does not mean that it is a good investment.

Starting point is 00:29:21 So be very weary, especially as you see crowdfunding. Somebody wrote in, is it right for you? And this is such an amazing question because as much as we glamorize angel investing, angel investing is not right for everybody. And it's also not right for everybody at every stage of life or every season of life, as I call them. The honest answer is that for 75, roughly, people listening to this. The answer is probably no, or at least not right now. And it really comes down to understanding your reasons for wanting to do angel investing and what you think the payoff is going to be. I knew that I wanted to, like my five-year goal when I was starting to invest was to literally start a venture capital fund like five years ago. So like for me, angel investing was a tool

Starting point is 00:30:07 to help me get there and to build a track record. Like it was not a way to build generational wealth. It was a for me to build my dream career, which like in some roundabout way, even though I have not raised a fund, like running our syndicate and now having a media platform that gets to talk about it and democratize it kind of is. But the answer actually lies in something that's been on our website for over a year. And it's called our 50, 2020, 2010 budget. And it is an evolution of an old budgeting principle. And it really is the concept of investing in yourself with that 10%. I felt like all of the budgeting tools missed the rich memo. on investing into things that brought into your network.

Starting point is 00:30:48 And let's be real, that is the majority reason that people go back and get their MBA, yet it is like so expensive. But MBAs typically work through cases. They also essentially pay to build a network. And I feel like when you are in the angel investing circuit and people know that like you actually have capital to deploy and you're like a value out investor, your network just spirals. Like you are getting introduced. I have said no to three introductions already today because I just am not interested in that

Starting point is 00:31:17 investment area anymore. But like the intros never stop once you're actually in it. So I think it's about understanding like your season of life and what the value is that you're trying to get out of it, what your cash needs are. And also like the value add that you can bring to companies. Because the only way that you get into the circuit or you get more deals is honestly through founder word of mouth, like being a value. add investor beyond just capital. So that's like introductions to other potential hires that they could have. That's introductions to investors. If you're one of those people that like knows everything, knows everybody, everybody's coming to you, be like, who do I use for this? And how do I get there?

Starting point is 00:31:56 And can you just me to there? And you want to monetize that. Like being an advisor or an investor is like a really great way for you to do that. But if you're somebody that doesn't have those value add characteristics, let's call them, like angel investing might not be the right way to build whatever your goal is in that moment. If it's like the financial reasons, if it's the network reasons, or you just want to sharpen those tools. Like you have to be just very clear on why you're doing it. And I think it really is situational and personal, which is why I recommend anybody listening to this gets our 50, 20, 20, 2010 budget. Like if you want to start angel investing, $2,500 or $5,000 into companies like a $66 budget template should really not be a dent in that. And if it is,

Starting point is 00:32:39 like angel investing, unfortunately, is probably not for you. Okay, next question is how do you find deals? I had to think about this one, especially from like when I was first beginning because I was more like crawling my way into deals and like asking to be at the table versus now where it's like an influx in my inbox and I'm like saying no. But the best way is to be best friends with founders. And founders is how every single venture capitalist finds their best deals because founders are founders are founders best friends. So you are going to find the best types of deals through people that are in your life that are founders. And if you want to get more founder friends, like that is not as hard as it is to find angel investors. And I would highly recommend, especially if

Starting point is 00:33:21 you're a founder looking for angel investors, try not to ask the question, like, how do I find an angel investor? It's like, how do you find more founders that have raised my from angel investors that you can then ask intros to. The other really great way is through venture capitalists. So a lot of times founders will go to venture capitalists to pitch and they will just be too early and VCs will be like, oh, but we actually have a bunch of people that are individual investors that we'd love to introduce you to. That's how I source a lot of my deals. So you should try to, if you're trying to find angel investors, it's like still try to pitch to VCs, get them interested, get them on the phone. And then even if it's a no or a not,

Starting point is 00:33:59 right now, ask them if they have a recommendation for investor introductions that they can make in the angel investment space. I also felt like the best thing to do is just have an amazing startup job. Being in the circuit of being an awesome operator, like I can think of somebody that works at a portfolio company of mine. That's the head of marketing. She has worked at two amazing consumer startups. And I guarantee you if she wants to become an investor or she wants to become my founder, her rolodex of potential introductions on an angel investment or venture capital side is not going to be a short list just based on the experience that she's gained as an operator, which is why my advice is always like do not try to go into venture capital right out of school.

Starting point is 00:34:41 I get it because like we glamorize it so much, but I don't think it's the best decision for you because you actually don't have an operational background to offer value to portfolio companies. And you also don't usually have a crazy network. You have to come into VC with a good network and build from there. And then lastly, obviously a syndicate. I hope that this episode was very helpful for anybody that's interested in angel investing, just wants to learn something new. If you can, please rate, review, subscribe, send, do all the things with the Hot Smart Rich

Starting point is 00:35:14 podcast. I hope that every time you listen, even if this episode wasn't necessarily for you, you leave feeling like you can become your hottest, smartest, richest self. And I made a promise. Like I promise to never have this show become one thing or one type of experience. I want you to walk away feeling like your life is enriched on so many different levels. So even if this episode wasn't for you, please come back. Maybe next week we'll be talking about sex or relationships or who knows.

Starting point is 00:35:43 But thank you so much for anybody that's listened to this entire thing. I am so grateful for you. I am sending you only the best hot, smart, rich energy. And I hope that when you leave, you know and you continue to build your worth. I love you guys.

Hot Smart Rich with Maggie Sellers Reum - Maggie Sellers On How To Start Angel Investing (Her Secrets Exposed)

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