After all, most angels are successful people, who made their money building or running businesses - not necessarily of the type that the entrepreneur was engaged in - and their keeness to assist often verged on intervention.
Current conventional wisdom is that entrepreneurs should strive to obtain 'smart money' - cash that comes with strong, in-depth knowledge of early stage, start-ups; an extensive rolodex; loads of management and recruiting expertise.
It hard to disagree with this although I have observed that having lots of 'smart money' in the project sometimes almost equates to having dumb money!
How so? Well, if a syndicate is put together of a collection of angels - a band of angels - unless there is a lead angel ie someone who takes responsibility for pulling the syndicate together, for staying close to the entrepreneur throughout, then the company may land up with the worst of all worlds.
The investment that each angel makes is often of little consequence to them, they take no 'ownership', get involved very occassionally and peripherally and if asked to advise they are seldom close enough to the situation to give really good advice.
Everyone gets that warm, comfortable feeling that they are co-investing with the great and the good of the eco-system, whereas in fact no-one really 'owns' the investment. No-one has the necessary unwritten but clearly articulated 'contract' with the entrepreneur that they will be their 'partner' in the venture.
Looking back on some of our failed investments, a few fall into this category.
Nowadays, if I'm asked to join a syndicate - "we're raising $1m and only need $200K - would be great to have you guys involved - I've heard how much value you add ...etc..." some of the questions I ask are: "who's the lead investor? Is he or she joining the board? How much time is he/she planning to spend? Are they being properly compensated for this time/effort?"
We are firm believers that choosing your investors is a fundamentally important decision to make. That they really do make a difference. Its not just quality that counts but the committment and willingness for that quality to be applied.
In the end, its hearts and minds that matter - not just cash and share certificates.