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How are angel investors different from venture capitalists?

We’ll dive into the details of the differences between angel investors and venture capitalist below, but here’s a wide angle of view first:

Angel investors are wealthy individuals (or groups of wealthy individuals) who invest their own money into companies.

Venture capitalists (VCs) are employees of venture capital firms that invest other people’s money (which they hold in a fund) into companies.

Now let’s take a closer at the two, before diving into the specific differences.

What are angel investors?

Angel investors are typically high net worth individuals who invest very early into the formation of a new startup company, usually in exchange for equity or convertible debt. The ro...

I’ve covered Max Levchin and the Web properties he’s built pretty much since I arrived in Silicon Valley in the peak of the dot com bubble. In fact, I spent hundreds of hours interviewing him for my first book, “Once You’re Lucky, Twice You’re Good: The Rebirth of Silicon Valley and the Rise of Web 2.0.” I continually try to get him on stage— despite having plumbed so many of his thoughts for so long— because he’s genuinely one of my favorite people to interview.

Not only does he have one of those iconic immigrant stories that should convince everyone why immigrants make this country stronger, but unlike so many other wealthy success stories, he’s never forgotten where he came from and what it felt like to be an outsider with nothing. Nothi...

Launching a startup can happen really quickly. Making it a real business — Now, that takes a lot of time. But how much time does it take to make a successful startup?

I get asked this question a lot. The short answer is it takes at least 4 years just to get pointed toward a real business, and I’d argue it takes 7-10 years to make your startup truly the success that you had in mind when that idea came to you.

Having been part of the journey of thousands of startup founders and having started lots of companies myself, I’ve noticed a very consistent pattern in how those formative years come together which I’d like to share with you.

If you’re reading this and nodding your head along the way it’s not because I’m monitoring your computer (that’s...

When Jason Ross packed his bags to make the big move to New York City in 2013, it wasn’t for a girlfriend, or to chase his dreams of stardom to the Big Apple. It was for a company – his company, the one he’d started building more than seven years before.

He’d sold that company, the early apparel eCommerce success story JackThreads, to an upcoming media company called Thrillist about three years earlier. The company was thriving in its new environment in New York. But back home in Columbus, Ohio, Jason started to feel like he was on the outside looking in.

“I started to realize all these meetings were happening in New York,” Jason remembers. “So you start to feel like, ‘Oh man, things are happening at my company that I didn’t put in place. ...

Of the many, many things that can be extremely confusing for a startup founder, how to assign startup stock options is undoubtedly near the top of the list. Stocks are a whole world unto themselves, complete with new vocabulary, confusing math, and complicated issues to consider.

If you're not already an expert in finance, chances are you're scratching your head and going “Huh?” while simultaneously trying to make it look like you definitely know what you're doing.

But have no fear! This is your very simple, “how to assign startup stock options” 101 primer. I've reached out to startup founders and financial experts to figure out how this all works.

Consider this your first step — and then consider buying some time with a financial expert so yo...

Your business plan needs a problem statement, because every great company starts by solving an important problem. The more accurately you articulate the problem, the more valuable the solution will be.

A common founder faux pas is overlooking the importance of giving the problem more weight than the solution. Founders get so excited about their solution that they forget to explain why the problem is so important. A well-articulated problem makes the value of your solution and your entire plan 10x more effective.

In many ways, the problem statement is the heart of your concept. It’s what intrigues people a...

In December of 2013, serial entrepreneur Jason Nazar woke up, rolled out of bed, grabbed his iPhone and with bleary eyes read the headline:

“Document-sharing platform Docstoc acquired by Intuit for $50 million.”

This wasn’t just any headline – it was his headline. Today was the day Jason would announce to the world that he had just sold the company he had worked on for 8 long years for a reported $50 million to Fortune 500 powerhouse Intuit.

Do you think he was smiling?

The Black Box of Acquisitions

We wanted to know the answer, so we spent some time with Jason to dig into the process.

The problem with understanding startup acquisitions and how Founders manage them is that people rarely talk about the process – they just talk about the out...

As my partner, Startups.com and Fundable founder, Wil Schroter likes to say, “There's not a lot of ‘fun' in funding.”

Raising equity funding for your startup is a long, difficult, and often demoralizing process. However, if you're successful, you walk away with money that will help your startup grow and become everything you hope it could become.

One of the major challenges that founders run across is that raising a round often takes more time than they expected. While a founder might know that your startup is excellent, convincing other people to invest thousands — and potentially millions — of dollars into their company is not a simple task.

“I've always heard that the rule of thumb is three to four months to do a fundraise — or that you sho...

Your team can make or break your startup. Seriously. This is so true that is has become a cliché.

Think about it. You’re going to be spending a lot of time together. You’re going to go through a lot of super stressful situations. You may or may not go broke at some point — together. So, when you’re forming your startup team, it’s really important to make sure you’re asking the right startup interview questions.

Sure, we all know the standards. What are your greatest weaknesses? Why do you want to work here? What was your biggest accomplishment in your last job? And a bunch of those standards made it onto this list. (After all, they’re standard for a reason.) But there are other questions you can ask applicants to your startup team that real...

I was talking with a Turkish startup friend of mine, giving him advice on his new site and proofreading his English writing. He hasn’t yet launched his service, and I offered to put it through userinput.io so that he could get feedback on the site and know how to improve it.

He said “well, let’s wait until I launch the site, then I will get feedback.”

And I said “No no no no no, let’s do it before.”

I’ll explain why I was so adamant.

When you finally launch your site, whether it’s a startup or an e-commerce or a portfolio site, you want it to be awesome, of course. And not just “awesome” but it needs to explain your offering clearly, create trust in the visitor, and not have confusing UX/UI and flow.

And the best time to get feedback on you...