Insight
Angel Investors Should Never Sign Startup NDAs
“Every investor that we've ever trained, we've said never sign an NDA because you have no idea what you're limiting yourself to, and that will preclude you from being able to look at anything else in the future.”
Assertion Not checkable as stated
Rusk: Startup investors almost never fund solo entrepreneurs
“Startup investors almost never fund solo entrepreneurs.”
Opinion
The '90 Pitches in 90 Days' Fundraising Strategy Is a Myth
“The rule used to be used to hear in like old time investors say, oh, you got to do 90 pitches in 90 days. Like it takes, it's going to take that. I think that's a load of crap. I don't think that works well. I don't think it works at all.”
Insight
Rusk: Local Startup Ecosystems Already Have the Resources Needed to Thrive
“We don't need some outside program from some, you know, big, you know, governmental agency or some, you know, white horse riding across the horizon to come and save the day. The resources that we need, we already have. We just needed to figure out how to put t…”
Assertion Contradicted
SEC Rule Expands Accredited Investor Status to Industry Risk Experts
“So new administrative rule by the Securities Exchange Commission. If you are working in a space where it is you have a fundamental understanding of the risk that you're taking on, you can consider yourself an accredited investor. Those floodgates have opened.”
Insight
Rusk: Angel Investors Must Identify and Mitigate Risks Rather Than Seek Rejection
“It's super easy to look at any kind of angel investing deal and get to a no. Like you can imagine a way a company can fail, right? And there are the things that are super real that you can see, like, you know, there's a hole in the management team or the go to…”
Insight
Rusk: Pitching 'One Percent of the Market' Is a Terrible Answer
“Think there's only really one answer to that, and it's sales, and if your answer as an entrepreneur is, well, if we just get one percent of the market, that's a really crappy answer.”
Insight
Rusk: Good biotech projects take seven to nine years to reach milestones
“Turns out it's more like seven to nine years on a good biotech project to see it to the next conclusion.”
Insight
Rusk: Three-Minute Startup Pitches Require Storytelling and a Path to 10-50X Returns
“In a three minute pitch, it's almost impossible to cover those five, which means you have to be able to tell a good story about it. There has to be an emotional connection, a market opportunity that's really substantial, and a path to success that creates the …”
Insight
Use Independent Experts Under NDA to Evaluate Proprietary Software
“The workaround is like, if we're doing something like software and the secret sauce is really in the algorithms, then we're probably as an investor group, we're going to contract with an outside third party that the entrepreneur agrees with that's not investin…”
Insight
Rusk: Angel investments rarely fall apart after a positive due diligence recommendation
“If you get all the way to negotiating the terms and you get to the end of the due diligence process, usually if the recommendation is to invest in the company, you don't usually see that get undone.”
Insight
Oversubscription and Legal Limits Are Top Late-Stage Deal Blockers
“If there's anything that stops it, probably that entrepreneur hits the limit on what they've lined out legally in the round, and they have to pause the process and figure out how to navigate that with investors.”
Insight
Rusk: Pitch materials highlighting product over company upside should be scrapped
“If you go back and you look at the materials you put together to talk with investors about, if you take a look at it and it reads like a sales pitch for the product, it's time to scrap that and start again. Investors are looking for what the upside is. For the…”
Assertion Supported
Rusk: Spending Over 20 Hours on Due Diligence Yields Higher Investment Success
“If you spend, you know, more than 20 hours doing due diligence, the success of the investment is going to be higher. I don't remember how much it is, but it's like a double digit percentage higher.”
Assertion Supported
Rusk: San Diego Angel Conference Raised Over $300K From 125 Applicants
“So this year we had a 125 companies. We're down to seven right now. We're about to, in a couple of weeks, we will pick the winner. And this year we've raised over 300,000 titled as a winner take all”
Insight
Rusk: Angel deals require at least information rights and regular reporting
“At the very least there's some kind of information rights and An expectation that on whatever regular basis they decide that the entrepreneur is going to report back to the investors about the progress of the company and financial performance and sales and tho…”
