Fundraising for a startup sucks.
Ask nearly any tech entrepreneur, and that’s what they’ll tell you. It’s time-consuming and gruelling, a mess of gatekeepers and vagaries and relentless pitching. Investors tend to have the power in negotiations, and often entrepreneurs are forced to jump through needless hoops or even pay money in order to pitch their startups.
Created in 2009 by Jason McCabe Calacanis (founder of Weblogs, Inc. and Mahalo), the Open Angel Forum was designed to allow startup companies the chance to connect with potential investors for free. Each event puts 5 startups in front of a crowd of 20 or more angel investors, with 5 minutes to impress the room with clever new technology and business models. While some critics have mocked OAF for its small size, the proof is in the pudding: startups continue to get funded after every event, leaving both entrepreneurs and investors very satisfied.
If you’re considering raising money for your early stage company, here are 5 reasons you should consider applying to Open Angel Forum:
1. It’s Free
Unlike many other mass-pitching events where starving entrepreneurs are made to pay $50, $500, or even $5,000 to present, Open Angel Forum is 100% free for startups. It’s not a business, preying on desperate founders; it’s a platform for connecting technology-builders and technology-funders.
2. Hard-to-reach Investors Are Made Accessible
Rock-star investors like Kevin Rose, Mitch Kapor, and Mark Suster are swamped with inbound correspondence. It’s hard to get through to big-name angels simply because everybody wants their time and money. OAF connects them with great entrepreneurs who would never have otherwise been able to get in front of them.
OAF isn’t just about big names, either. Organizers for each local event bring lesser-known, yet savvy, angels to the table. Each participant is hand-picked.
3. Entrepreneurs Are #1
Most, if not all, of the investors invited to OAF are former entrepreneurs themselves. By design, the event is as founder-friendly as possible. From the format to the atmosphere to the preparation given to each company before the forum, the end goal of the event is to get each company funded and off to do what it does best: build innovative products.
Dave Dupont, whose startup, TeamSnap, presented to the angel investors at a Colorado OAF event, refers to OAF as “the most valuable investment-oriented experience we have yet to be involved in”.
4. No Bull
At OAF, it’s all about the demo. PowerPoints are outlawed, and startups are encouraged to throw their raising figures and valuations out at the beginning and the end of their pitch. Founders get 5 minutes to show off their product or prototype, and 5 minutes to answer questions. There’s no messing around, and those who want to dig deeper are welcome to connect after the forum ends.
A typical OAF event lasts for about 2 hours and is held at a local venue, such as Dogpatch Labs in New York City.
No Open Angel Forum is complete without free food. Each local forum chooses the fare that suits it, and after a quick meal, founders and investors get down to business. When the founders get up to speak, it’s common for them to do so with a beer in hand. A free beer.
It’s not just the startup companies who are stoked about Open Angel Forum. Investor Mark Solon says he likes that Calacanis has “set an example for angel organizations everywhere that it’s about the entrepreneur” when he created the program.
Next time you’re in the market for angel funding, consider applying to OAF. Since each event only allows a few startups, you’d better have a well-thought-out application if you plan on competing for a spot. Once you’re in, though, be prepared for royal treatment.
Fundraising still takes time no matter how you go about it, but OAF helps finding the right people to invest in your company suck a little less. And at the very least, you get a free dinner!