Industry News

Founders Series: Angels Den Founder, Bill Morrow, Talks to OFF3R

Aisling Browne
Written by Aisling Browne

OFF3R caught up with Angels Den founder Bill Morrow to discuss what he thinks makes for a good investment opportunity and the future of Equity Crowdfunding.

What’s your background?

Dull accountant at Virgin and Investment Banker

What does Angels Den look for when choosing companies to list?

Three main things:

  1. Sales are vital for angels to invest … they do not invest into ideas.
  2. Secondly, some protectable USP … be that a TM, Copyright, first mover advantage … anything that stops a large player coming in, and taking the market.
  3. Thirdly, we look out for the business owner to understand the value of mentoring over just getting the money on board. That’s one of the key reasons that over 92% of all the deals funded in our ten years are still growing.

Who do you think is your target investor?

We are looking for two types of investor, one that takes a passive role in the business and those that want to lead the deal and give them what they really need, mentorship, experience and contacts. Every deal we fund has a lead, based on 10 years of learning we know that this investor is key … those angels who “just want to make money” from angel investing have not done their homework. Most of our angels have had successful careers and want to continue to play a part in a dynamic business where they know that if they just throw in money without direction, they will lose 80% of their cash. Also, if an angel takes too long in looking at the forecast numbers, for instance asking for a three-year forecast balance sheet, we know they do not understand this market. If they believe these numbers and/or take them at face value … they are doomed. We are showing over 59% return for our investors (April 2017), based on super-curation of the deals but also from running free masterclasses for angels to augment their existing skills. Much as we demand humility from our business owners,  investors who know everything already are not of interest to us.

What’s your favourite investment listing, present or past, on Angels Den?

Any deal that has overcome adversity, who has dusted themselves down, learned their lessons and made a success of it. I have a soft-spot for women-led businesses, indeed our investors tend to agree, as they are over twice as likely to get funded, using our mechanism. Lastly, we reject any business owner who knows it all already … humility is key to gaining investment (and to being an investor), you can have the best business but if you just look at investors as an alternative to a bank, then they do not understand the real value that an angel can bring. Clever money is always going to win, over thousands of people investing £437.

What do you think 2017 has in store for Equity Crowdfunding?

Most players are buying market share at an unsustainable cost to them, (and their market) and until they begin to realise that funding over-valued, flakey businesses is not winning, they will not be successful. Call me old fashioned but until you present deals fairly, do a minimum of DD and educate both sides of the deal, the deals will continue to fail. Surely, THIS has to be the goal, not just looking at every deal as a short-term money-making opportunity which fails after 16 months. In any business, if you adopt a short-term view and fail to keep BOTH sides happy, you will fail and thus I worry about the future of equity crowdfunding. You cannot hide behind the “fact” that “everyone knows that 80% of start-ups fail” … we show that it does not have to be like that.

If you weren’t working in this industry, what would you be doing?

I would run a virtual accelerator. We have never seen so much money in the market but business owners should understand that VC money, is different from Equity CF money and from Angel money which is different from FF&F money. Setting up a business is easy, STAYING in business is hard … understanding the pros and cons of these funding avenues is crucial and every day I meet owners who “just want the money”.  I am passionate about helping people understand this.

3 things you’d never leave the house without?

  1. My phone
  2. Wallet
  3. A large club.

Head over to the OFF3R Equity Crowdfunding Channel to view opportunities from Angels Den.

About the author

Aisling Browne

Aisling Browne

Aisling is the partnerships manager at OFF3R. Prior to OFF3R, she spent time working in New York at a property development business and subsequently for the British Red Cross in London. Aisling has a BA in Politics and International Relations.