naval

Sorry spike, I wasn't trying to be rude. Never my intention. You likely caught me unawares and my animal brain responded before my human one could catch up. Be well.

There are no double fees on this fund. The 30% is used to pay the angels their carry, out of that 30%. Whatever's left goes to the GPs. Warren's criticism does not apply here. The rest is correct :-)

No management fees, angels invest their own money alongside, no 10-year lockup, enter / leave with one click, track everything online, and have 40 angels invest $25M instead of 2 VC Partners. But yes, other than that, there's nothing new here.

It's about 1/3rd of what technical recruiters charge. And again, it's only on successful hires. And if you can't afford it, you can give equity. And it's an honor system. And it's a test. And other folks in the space, like DeveloperAuction, charge more (Google around). But you can't please everyone :-)

Not random, we've just been doing it for new companies joining the platform.

The headline is sensationalist but incorrect. There is no cost for posting - only if you land a successful hire, similar to how some others in the space work.

Yes, WSGR will do the closing for free, for any startup that they're willing to take on as a client (i.e., credible). We'll be announcing other law firms who will do the same shortly.

In most Series Seed financings, the Founders retain Board Control and can't be pushed out by just the Investors. If they're pushed out by the other founders and by the investors together, then their vesting agreement will govern what happens.

I'm actually a former coder, albeit not very good.

Even complex problems can be chunked down into smaller things. That's pretty basic.

Business Development.

The problem is that there is an incentive to always pad estimates. By forcing a one-week schedule, you counterbalance that tendency, and make it possible to measure yourself more accurately. Despite this, I'd say that many of our projects fail, never ship, ship and have to be rolled back, or ship and have to be iterated 5 or more times until we get them "good enough." But it still beats taking 3 months to ship something interesting, which is the cycle most startups are on once they're out of an incubator or done with their initial release.

We do regular one-day long refactoring sessions where everyone refactors. But yeah, our codebase is not a thing of beauty. We're more focused on figuring out what users actually want, and we'll rebuild it when it's falling over.

In my experience, tasks that take longer than one week sometimes take two weeks. But if they don't make it within two, they basically never ship. It's like you can go out and have one drink, or two, or many. But never three...

That's the idea. And it doesn't have to be angels / VCs only. It can also be the community of entrepreneurs. Don't worry :-)

All social proof means in this context is that there is a community of gatekeepers and scouts rather than one or two gatekeepers or scouts.

So, our fault for not having caught it the first time. But the reason is more innocuous than you might think. On a busy day, we can get 50-100 startups showing up. That's a lot of applications to read - so we run an algorithmic filter to decide what to even look at. My guess is that your initial pitch didn't make it past the filter. The second time did, but not because you had a ton of offline traction with press and investors, but because you had a referrer who's known to the community - Joshua Baer. Yes, that's a bit of social proof (knowing an entrepreneur who's respected in the community) but not a particularly high bar. We'll try and do better in the future, and meantime, congratulations!

Actually, we read most of the pitches that come into AngelList (there's an up-front algorithmic filter for junk). There are other investors who browse the incoming firehose as well. If we think something is interesting / likely to be a good match, we email it to investors who follow those markets and locations. If the company gets interest, we broaden the send. Investors follow / take intros as they're interested. Keep in mind that 95%+ of businesses are not fundable by early-stage tech-focused Angels. AngelList is not a circular-reasoning walled garden. Most of the value that we bring investors is surfacing them deals outside of their social networks, and most of the value that we bring startups is finding them investors outside of their social networks. If we didn't do that, we would fail.

It's very much like a dating site. We can't let all of the guys contact all of the girls whenever and however they want. But matches are made all the same.

I don't think it'd work. Great founders are usually passionate about their business and have been thinking about the problem for a long time. It's unlikely that an "idea from the outside" would be well absorbed or by the right kind of person. Ideas are a dime a dozen anyway. It's all execution.

Why don't you email me instead Tremt, and I will investigate. No point in launching a public witchhunt :-) I'm at naval at angel dot co.

You're right. There will always be an offline component, and a big one. But lots of stuff, including the introductions, the social proof, the transaction, the matching, should move online. Moving it online is more aspirational and directional than absolute.

This is a very nice and pithy observation - you're basically arguing that it's a classic power-law distribution: a few huge winners, and lots and lots of small players - who traditionally would have been defined as losers, had costs stayed the same. But they haven't, so the long tail is full of (small) winners.

I'm going to update my original post with some variation of this... Thanks.

They can work but generally they tend to be service companies for a long time before they become product companies. However, they're almost never done by part-timers. Even 37S and FogCreek are full-time labors of love. Also, there are always exceptions - I'm talking about mass statistics / average web startups - stuff similar to most YC companies.

I originally started my angel fund as an incubator (The Hit Forge). I quickly moved away because of Adverse Selection - the best entrepreneurs are insanely committed to themselves and their ideas, and rationally or irrationally, don't want to diversify. Since then, I've invested in a lot of companies, including Twitter and Disqus and Heyzap, and am glad that I did so. The Incubator model works as a "search" model (MRL Ventures, Obvious Labs, Ooga) where the Incubator "finds" a company that the principals join, but not as an "investment" model where the incubator survives and keeps spinning out companies. This is true because you can't create or replace entrepreneurs - you can only discover them or be them, but you can't create them.

The other problem with this proposal is that the Internet is extremely competitive. You can't do anything great part-time over the long term. A funded team working full-time has a huge advantage on you.

Of course, giving up control sucks. "Valuation is temporary, control is forever." And a business controlled by VCs too early can't innovate easily. So, either raise money from angels, or learn how to negotiate with Venture capitalists. Check out Nivi and my writings (sorry, shameless plug) at http://www.venturehacks.com.

If you do have a good product with traction and are out raising VC money, ping me and I'd be happy to help you keep control (free!)

Nice - reminds me of a much better version of the old Slashdot interface - I was always going to "Threaded" and "view all on one page"

Now if someone would just create a working RSS full-text feed for Paulgraham.com...

So I'm the guy behind Hit Forge.

It's changed - that PR is obsolete (Thanks PG, for helping with the strategy shift).

We're a straight early stage seed-investment fund. We invest in social-media early-stage web startups, putting in between $100-$500k. We maintain specialist resources to help with SEO and Viral Marketing. We provide free office space to our companies, if they want them. We have a one-page no-hassle termsheet, where we buy something that looks a lot like common stock. We don't try to control the company. We help with future fundraising (see my blog at http://www.venturehacks.com). And we decide very quickly.

PG pointed this out to me as a gap in the market for early stage web companies, and he is absolutely right.

See you all at Y-Combinator D-Day.