-Alex

Here's a virtual bottle of mouthwash – we can all improve!

Sounds like CrowdPitch!

Interestingly enough, the companies most willing to pay presentation fees are those that are doing well in their fund-raising, as it becomes a more efficient cost of capital. If they can get in front of a qualified group of investors and hit them all at once, it is much faster than chasing down a bunch of individuals. Plus groups typically work from a single term sheet (versus n X number of individuals), so the closing process is less onerous.

But I keep coming back to the concern that we aren't getting enough promising young business out in front of investors, and I might have a solution. What would you think of a "Pitch-a-palooza" where we get 5-10 early, early stage businesses to deliver 5-7 min quick-pitches to our members at no charge? We could do this as part of a regular Forum meeting, maybe quarterly?

Let's keep the dialog going – I hate to be cast in among the vomit-inducers.

My opinion is one thing, but it is after all an open market. People can pay to pitch if they want to, of course. But I think you do get some adverse selection. Meaning, companies that know how to pitch and have wide access to investors aren't going to bother. I assume it would benefit your membership to allow those with strong momentum and presentations to pitch for free. I think the fees are usually designed for two reasons in most angel groups. First it's to make sure companies are "serious" about presenting (usually a $100 or so fee is used) and second it's to "recoup the costs of helping them make an appropriate presentation". I suppose there are other reasons (I'm sure your differ somewhat at Keiretsu). It's most sad when memberships are unmonitored (meaning, full of non-investors – and I clearly understand that this is not something Keiretsu suffers from but the problem is generally rampant) and fees are used to make sure the venue and wine are nice enough.

So, in order to try to be constructive, I'd suggest a couple of alternative models to think about. Knowing you, I'm sure you have and I comment and write here for education, so I'm happy to get feedback.

I assume that the fees go mostly towards the "screening process". In my experience, these processes mostly suck. Why not get rid of it? Eliminate the cost center. Leverage your membership. Any company that is presented by a member gets looked at by the group. If a company can't impress a member of a national organization enough to get him to vouch that the company is worth looking at, then it's probably not. Everyone in the organization should be reasonably accessible for 1 or 2 coffee meetings a month (we all do it anyway, right?) to meet with entrepreneurs. if you're not – then you're not serious about investing in them in the first place. I must have 30+ meetings like this a month. I'd vouch for about 3 a month as "interesting enough" to get looked at by an angel group. Then my reputation is on the line. No further screening needed. No cost. And, bonus, if I see something that I think is interesting, I can coach them a little on getting their presentation in order and I'm the hero for bringing it to the group!

Thanks for the comments Steve. Nothing here is meant to attack Keiretsu specifically. I've just seen so much disservice to entrepreneurs by taking their money and giving them essentially nothing in return from other groups, that I've formed a strong opinion.

OK, I'm the one that needed to do more research However, I think their model even further underscores the presentation fees issue: how does a small angel group survive without charging presenters? I can tell you that increasing my member dues to offset the loss of those fees would likely result in a near 100% drop in membership. Given that we are probably the largest and most active angel group in CO, that says a lot about the sensitivity of investors to their own fees, and to the sustainability of these groups. Do you really want us gone?