A portfolio approach to angel investing

So Angel Academy is an opportunity to learn. It can be a one-and-done experience. Um, we welcome you. If you would like to continue the journey with us, um, we'll be talking about how you can do that. And you saw around the room, there are a lot of people that have come back for more, and so please feel free to talk to them about their experience and why they are coming back. So what we have in store for you is a series of speakers that have been curated by our MC, Neal Bloom.

I'm going to tell you a quick story because we're here to learn about angel investing. Angel investing is about looking for opportunities when they look the most uncertain and haven't been met. And honestly, it's a muscle, and we're gonna learn together throughout the day and hear from others who have honed that muscle in different ways, right? There's a lot of ways to, uh, to grow a muscle. So my grandpa moved from New York to Los Angeles in 1952 and promptly opened a burger chain called the Sterling Burger in North Hollywood, California. And over the years, by 1958, he'd opened 5. And one day a guy knocks on his door and says, hey, I'm, I'm starting— I've just bought into a burger chain and I'm looking for investors into my burger chain, and would you be open to it? And I'll give you the rights to purchase all the selling platforms, uh, but also be an equity partner. And my grandpa said, well, I'm busy running mine, why don't you know, like, what's the deal with yours? We're both in burgers, we're competitors.

And he passed.

And he passed on Ray Kroc, who knocked on his door to say, would you like to invest in McDonald's? And that story stuck in my family, it's obviously told, for many years because in early 2000s when I was looking to apply to college, my dad was still running Burger Chains and I was like, well, of course I go work in the family restaurant business, right? And that story has been, you know, obviously replayed many, many times. And we're not the only ones. Pretty much we look all the time at what could we miss where there was a lot of FOMO around, did we miss something? And the only way to do that is to look inward on ourselves, on a feedback loop, and just learn about ourselves, about how to look for opportunities and how to assess them and how to get better at it. The best way to do that is as a group, where we're all synthesizing data differently but sharing knowledge together. So today is really just step 1 in the process forward. All the way through end of May, what we're going to do as a group is test 119 applications as of 11:59 PM last night. Uh, on our way to investing, backing people and their companies who are going to change the world, uh, and we're going to be along for the ride of that, uh, going forward. So I'm excited for today. I've curated a group of friends who I call advisors and mentors to me who will come out and share their knowledge and expertise, um, and I'm really here just kind of guide us forward. And really it's about learning I said as a group, which means questions. You know, each of you are in your own industries, which has their own jargon, and angel investing is no different. It has jargon. It has a lot of acronyms. Please stop us and ask those questions when we forget and gloss over them. Okay? Like, totally fine. And it's just because some of us have been living this for 10,000 hours and others are just starting on our first hour. Okay? So stop us at any time. Don't wait for the Q&A part of a panel. Jump right in and ask. The discussion part is where kind of the meat is for the day. Um, any questions on the outset right now? How about any expectations? Anyone expecting like, this is what I want to walk away with at 5 PM tonight? Okay, got a low bar. It's okay, manage that expectation. Actually, 5 PM I'm expecting cocktails. Great. Okay, I think I can almost guarantee that that will happen. 99% sure that you have a concept back here. Um, yes. So I thought it was really marvelous last time because you kind of went just through some frameworks of how you work out who you'll invest in, what state it is. I thought that was really powerful. And I guess one of my expectations, like, at a table, is we start to build on top of that or share some more of those. So thank you. Yes, frameworks. We love all of frameworks, especially me, engineer. I love to like apply a matrix to everything. Um, yes, but the goal is to hear from other people and hear their frameworks. So that's what you'll hear from the speakers that I've curated, is hearing and asking that same question. Hey, what is your framework for assessing at this stage? What's your framework for diligence? So yes, you're going to hear— I'm going to repeat my 4-question framework, uh, that we did, uh, you know, a few weeks ago, and then we're gonna have others explain theirs, like Ashok Kumar, who runs New Fund Ventures. We're gonna ask him, hey, what's the New Fund framework? For assessment. You have some serial, uh, angel investors also saying— and we purposely curated one where it's a husband and wife on the panel together because they have a bit of a joint algorithm where they assess together. What's that framework about as well? So yes, you're going to hear about people, how they've honed the muscle or the framework. I kind of use those words interchangeably. Uh, what— any of them talk through slides?

Yeah.

Okay. Uh, the, uh, SDAC, San Angelo Conference, which is the process that really much begins next week through end of May, uh, is learning as a group, investing as a group, but also behind the scenes administrating and advising as a group too. And I am super fortunate to have the FAF, the Fund Advisory Board, who are past fund managers, uh, who are going to help guide all of us through from a leadership angle, from both from a here's what works and doesn't here's what we need to be doing on a weekly basis and moving us from a whole bunch of applications to a conviction and investment in a few. So thank you to Pons, Brian, Tracy, Chris, and Mark. Thank you guys for being on the Fab this year. Thank you. Compounding the knowledge and leading. So thank you. Takes a lot to not just join the investment group but also share knowledge and lead others forward.

And so I don't take that lightly.

Appreciate it.

Honoring his time, and we all learn a lot from that as well too. So, uh, San Diego Angel Conference Fund 8. This is an actual fund, so this is a fund, really has become an annual fund set up for, um, uh, investing one time into a number of companies. Uh, the way that the fund works is that you commit to, um, specific, uh, buying specific units that have a set unit price. You're buying shares in an LLC, in a sense. Um, and these funds go into investing in companies directly, pretty much one time. So the funds are deployed all at once at the end of San Diego Angel Conference. There are some funds withheld for the administrative piece of setting up a fund. These are tax, legal, and ongoing yearly filings that need to be done at the state and federal level. Um, the fund itself requires a minimum amount of funds that are committed, uh, so 37 units. And as of this morning, we're at 22 units, so we're doing pretty well. I think we'll actually be— I hope— my plan is by next week we'll be at the 37-unit mark. Um, and to be a part of the fund, uh, you need to be accredited investor, which, uh, we'll talk about. But to be here, you pretty much have to be a credit investor as well. So the really the high level— and Sebastian, don't come in for butchering the, I think, 15 different points of how to be a credit investor. But generally it's based on net worth that doesn't include your primary real estate, primary residence, and/or annual income of or above $200K for individual or $300K as a household or specific knowledge that the SEC is determined usually by a Series 765 or 82 license. There are other ways as well too, but those are pretty much 99% of the way that most angels are accredited investors. And in the docs, you actually select a box saying, I'm accredited by one or more of these things. Okay, investing in startups and really investing in private companies. Any stage is super risky. Where we're investing is at the earliest of stages, where the uncertainty is the most, uh, unknown, or there's the most uncertainty, because these companies are, are super nascent, right? They're just in the beginning stages of every aspect of even, uh, finding if there is a problem we're solving, if there's a customer that wants to pay, is there an industry even identified that feels the pain yet? Does the market even exist? So there are so many reasons why startups fail. Did you pick the right co-founder? Did you start one year too early or one year too late? Right? So there's so many reasons why they could fail, but a number of them you can start to see ahead of time for a number of reasons. Now, 90% of startups fail within first years, first 5 years. This is actually pretty true. And for— it could be management, could be just co-founder related, uh, team that's just inexperienced, lack of market need. And generally most startups fail because they run out of cash. That's, that's pretty much the main, the main reason, uh, is just capital does not exist anymore to continue funding it. Now the way that, uh, investors tend to make their money back on investing in early-stage startups is by indexing or having a bit of a portfolio so that you make up for the ones that fail and then the ones that have the outsized gain. And so this is called— generally called the venture power law, where you have a bucket or a cohort of investments and, you know, some fail, some return money, and some return 10 to 100x. And so many of you probably manage a portfolio, same mentality. And so that's why we With the idea of the fund is the idea is with it you're investing in within a fund which invests in a bucket of companies, if you will, between 2 to 4 typically, and sometimes maybe even 5, depends on the amount of capital we raise as a group. Um, and so that's the portfolio approach as opposed to just picking one company to invest in. Uh, and then there's the upfront work done before investing, which is all the diligence. That's pretty much what's going to happen between now end of May in getting to know the companies and a weeding process to do as much diligence as possible to see, did we pick the right bucket of companies to invest in as a fund? Any questions on this?

Okay.

So this slide is for you. It's not the schedule. It's not really the schedule. It's the process. So this is your process slide.

Sure.

Okay.

So Same with Angel Conference is a very hands-on approach, meaning we do a lot of work to make sure we get to know the companies in as many ways as we possibly can. That's done pretty much on a weekly or sometimes multiple times a week basis. This process is done as a group. I will explain the difference, how involved you want to be. There's— we didn't mention actually upfront to invest in the fund, you can be an active investor or passive, and you can actually be both. You can have active units and passive units. To be an active member in the fund means you have a say in voting for who we invest in, and that's done at Sanyo Angel Conference at the end, very end. You also can be a passive member, which is the same units, same, you know, buy-in. You just don't want to have a vote in the final investment decision. Totally fine. By the way, last year I was a passive member. And so that's the official active versus passive in the fund. Now, you can also be active in being present in all of the procedures that happen in weeding from 119 applications down to, you know, 2 to 4 companies that we ultimately invest in. And so this is— I'm going to walk you through quickly, just like how we're going to go about doing that so that you get a sense of how you could engage throughout the process. Either way, if you're a member of the fund, you don't have to engage in this, all of it, but to be an active member, the documents line up that you actually have to engage in 50%, you have to attend 50% of the events to maintain your active presence, to have an active vote ultimately in who we invested. Does that part make sense? The question— you have to attend in person, or you can virtually? No, we will have virtual as often as possible. We do love in person, but we understand that a lot of us mean like during the week, weeknights, where a lot's going on, and we will create a hybrid, uh, opportunity for as much as possible.

So I'm gonna use my computer, um, we— I'll do my best for the hybrid. Portion to let you know, hey, it's during the networking, we'll go back, we're back. Um, I'll do my best to do that, but typically the first 30 minutes are networking, and then we depend on getting started at 5:30. And during that networking, there'll be food and beverages, so we do provide dinner. And then there's about 2 hours of programming, discussion, whatever the activity is, and then another 30 minutes Our hosts, like Vince and other hosts that are providing the space, are extending their staff to accommodate us, so they do ask that we leave promptly. It's not something this group is quite good at, but I'll be the one typically that will be scooching everybody into the elevator, and hopefully you'll have somewhere you can continue your discussions. But we like to be mindful and send folks home on time. But networking is a really big component. Um, the other thing I think, Neal, that would be interesting is you've looked at this, you've taken a lot of feedback. Once you talk about the process, you've taken a lot of feedback. And so, um, so Neal has— is looking to do some things differently, uh, with the group in terms of being more efficient with your time. Um, I don't want to take your words, but I think that would be— I think this is a really important area to talk about and how you're looking at it and how you've taken the feedback and what people can expect, especially if they've done it before.

Sure. So, uh, yeah, in synthesizing 7 years prior of how active San Diego Angel Conference members have been involved, um, I've looked at and heard a lot of how great the learning process is, but also how great the time is to learn all of that and get through this. So I thought, how— I'm synthesizing, like I said, 7 years worth of hearing that and understanding how do we learn the most but also not stress ourselves out the most. Okay, so, um, we want to invest, which means we have capital to do that, uh, but time is money when we're at that stage. We have the capital to do that, and so I'm looking at how are we efficient and taking as much administrative headache out of the process by streamlining that. So hopefully what we go through this is a process where you maximize learning minimize administrative stuff where you're not the expert on that. Um, and so that's why I'm super fortunate to have the intern team. We'll be distributing a variety of assets of how they can help us, from application processing to feedback loop when you're in a group, uh, as well as making sure if we have missing information from founders, we get that as quick as possible and we don't have to kind of do the emailing individually. So You'll see that throughout, but just know that that's my North Star for us, is maximize learning, minimize headache. Okay, uh, and open feedback on everything if that's not what's happening. Um, so overall, I'm not going to go through day by day, but we have a big task ahead. We have 119 applications.

Uh, and wait, wait, Jen has an update. We laughed a little squishy this morning.

Application.

We have 149. Sounds good, so we'll put those extra ones on it if we need more. Uh, okay, either way, well, are we closed now?

We are closed. Great, shots blown. And they all have to make their payment for it by 5 PM tonight, so I'll have an exact number. Okay, cool. So 115K. Price, $150. Yeah, it's $49 to apply, um, $115 paid, and then we have at the end of the day. But I can announce that.

Okay, either way, rough— roughly we have 100+ companies that we have to review applications. Now that doesn't mean all of us have to review all of them, okay? So don't get worried about that. Um, we're going to distribute the load and make sure that every company gets reviewed by at least, you know, multiple people, if not groups, multiple groups of people. So we'll, we'll kick off the week next week by actually learning what that process is. When we see where are we going to be reviewing applications, what is expected of us, and how do we actually get to a yes or no on this application. Do we want to, do we want to learn more about this company? And we'll do, we'll get into groups so that we can, once we do our own assessment of a few companies, we share it with the group. And synthesize it on what we think a yes or no is as a group. Okay. So that'll happen over about 2 weeks. Next week we'll get our groups and get our companies. The week after we'll start talking about it in groups. Hey, this company I was a yes on, this company I was a no on. Everyone agree?

Cool.

If not, why not? Let's talk about it. Okay. So that's what the first few weeks are about. It's really getting down and cutting to the companies that we just think they're not the right fit for where we're trying to get to. And I'll talk about the framework of why they aren't a fit, uh, one synthesis later in the day. Okay. Um, then once we've gotten down to, uh, our 25 companies, we want to hear, we want to meet them. We want to hear the pitches. So we'll invite them to pitch us in person. Um, and then further weed down from there and then, uh, hear further pitches. So we'll go from a 3-minute to a 10-minute. And then once we're down in, down selected to 6, we'll start heavy diligence. This is in all areas. Once we're in diligence, we're now really starting to eye like, we could invest in one of these companies. And so now we're also looking at, you know, what does the investment potential look like as well too? So we're laying that on in terms of terms, check size, that kind of stuff, which will all be part of the diligence. And what we'll do sprinkled throughout here is like, on-demand learning that says, hey, we're about to enter this phase of the process. Let me tell you what a term sheet is, and we'll have an expert come up and walk us through what a term sheet, what terms are, what's typical, and what's market rate for investing into a company on a valuation. So we're going to sprinkle that in as learnings throughout these events that are poignant and specific to what we're, what we're about to do as a task as a group. Any questions on the timeline? Ultimately, this is our Super Bowl right here. So May 29th, in person. This is the day if you're like, how many events should I go to? Well, this one. Definitely come to this one. All of us. Because this is the day where we get to showcase the companies and we make the decision real time and hand the jumbo check, which is super fun.

Okay, so a couple changes. Uh, if you were here last year for kickoff, it was a really long night. We, um, we tried to— I have food in my mouth— so we tried to accomplish a lot in one night, so I wanted to break it out. So we have an orientation. That orientation, the deck is very similar to what you're getting today, and we will provide that deck as well as the Zoom call. You're welcome to participate on the orientation, but there is some redundancy. What's new in the orientation is Hans will walk through DUST, and DUST is the application tool that will also be recorded. And once you've signed the fund documents, one of the benefits is you get access to the full library, including Angel Academy, including Anything that we do, we record it so that you have the knowledge to pull from. So, love to see you all in orientation, but GUST is what's really different from today. And, um, we could even send out what time GUST starts. So if you don't want to listen to the same thing over again, you could just call in for the GUST part. The kickoff, we're going to do it, some networking. We love our networking, and then we're going to get started just like Neal said. So this is different from last year. We're going to get started. You're going to be seated with your groups. You're going to have an opportunity to get to know the groups that you'll be working with to go through the applications. Neal will talk about the philosophy and how to get to know quickly, and then you get started. So we ran really late on that part. So everything that we're accomplishing, um, on the 12th, we ran really late last year on that. We're going to start with that first. So that should be a very productive meeting with plenty of networking. Um, or was it Brian that was emphasizing— and the networking activity. So that— just wanted to point out those differences. Another big difference is we didn't really word, um, the meeting that's on 3/17. We used to try to get to 50. We used to try to get to about 50. This is really about get to know, whatever that number is. And then you should also know the top 25 isn't really the top 25, it's 24, it could be 23, but it's some number around that that we're trying to go down to. Yes, Randall.

Uh, are we going in person or are they—

all the meetings this year are in person with the Zoom option. And so if you're working with a group, you would arrange for the group to have you be in Zoom, um, or we'll provide the Zoom when it's a large group environment. But we did decide to make them in person, um, yeah, with the exception of the first one, with the exception of the orientation, which we pulled especially because not everyone needs the orientation. They might be familiar with GUS, they might already have attended Angel Academy. Um, so we wanted— and we wanted to be able to have a good reporting of that as well.

Will all the in-person be here?

No. So the in-persons are in the Sorento Valley, are really in the Carmel Valley area. Um, as one of the benefits of being a sponsor is you are at a certain level, so you get to host and show off your beautiful space and facilities, which we love. I saw another hand. Okay, okay, so some key dates. So in order to start attending the member-managed meetings, including the orientation, you have to have signed IRF, which is where you say that you're an accredited investor., and all of you have done that, um, so great. And then we, we, uh, have an incentive to pay the donation to SDSU. Um, raise your hand if you went to the VIP San Diego Football Club experience last year. Super fun. We never sat in our seats. We were in the VIP part, and it was really a great experience at Snapdragon. So that'll be on April 11th. If you make your donation by the 13th, we'll be able to secure a ticket for you to go to that. By 4:15, that is when we ask for the final, um, deadline for your donation, which goes hand in hand with signing the fund documents and securing your purchase of at least one unit, um, by 4:15 to be active. If you have any questions about being active versus passive, Neal mentioned that, and Neal can talk about it further. And then after that, you can still participate. Uh, of course, we encourage you to, to dive in sooner, but you would be participating as a passive. There is a clause in the documents that does allow you to change from passive to active. And again, that's something that you can talk to Neal Bloom about, um, as the fund manager. Any questions about these deadlines? Okay, so, um, this is the link to the donation. Uh, what you'll find is we— it's— if you're new, it's $1,000. Um, but when you come back, there's an incentive to come back. And as coming back, we do request that you become active in the community and help pull along the new people. So that it's enriching for everybody. And so that's why there is a discount. Um, so it's not SDSU alum, but SDAC alum, it's $500. And that is a donation. It is a charitable tax deduction. These are all the benefits, um, when you make the donation. So you do have an ACA membership.

What's ACA?

Jen, can you talk about it? The ACA membership?

Uh-uh.

No.

It's Angel Capital Association, and once you pay, we will log you into it, so you'll have a login to get access to— they have special webinars. How many, how many of you have used it before?

Okay.

Is there anything else you'd add, Brian?

Well, it is a national association, and they do have an annual conference, which we attended en masse a couple of years ago. We're trying to get one here in San Diego as well, some help from, uh, from others. So look, look forward to that. And it is again included in the membership fee that you pay to, uh, donation that you made to San Diego State.

So another couple things I want to point out is we do have these special events that we host on campus that we really don't promote externally. And so As a member, we do include you. We have Startup Stories, which are these incredible entrepreneurs that come typically here or to another location on campus and tell their story about their entrepreneurial journey. They're really fascinating and fun. Many of them are alumni, but not all. And then the Presidential Talks are really interesting. We had Eric Topol last year. And then did anyone attend the Zoom yesterday? Any members were invited. So we had someone talk about the economic outlook. So those are really interesting and you're getting special access to them. Um, I think we've covered most of these. Are there any questions? Okay.

Yeah, I was just going to say, sometimes looking at that schedule, it can seem a little overwhelming or intimidating, like, oh wow, that's a lot. Um, but one of the things I would say is that There was a lot of feedback last year— all mostly all of these were online last year, and it just we're all online too much already and kind of have Zoom fatigue so that the fact that these weren't enabled to be in person and then zoom option if you need that I think is fantastic and one aspect of getting all the feedback from last year. Kathy Neil bloom particularly done great job on this agenda of course is um. Getting that feedback from everyone who participated last year and really synthesizing it and figuring out how can we continue to make this better year over year. And I think this is one of those things. And the other thing I would say is we've had, um, we've had a bunch of discussions about really making sure we're thinking about the purpose of, of this San Diego Angel Conference is activating angel investors. And so as we think about the balance between efficiency and learning, you know, there's, there's this, this kind of push and pull about certain aspects of the process. Like, we can make it more efficient, but then are you compromising actually going through and getting those learnings? And I think the team, again, has done a really good job of trying to balance that, figuring out how to be the most respectful of everybody's time, but also making sure you're getting out of it what you're putting the time in to get out of it, right? Like, it's not just about, you know, investing in this fund. It's about learning how to evaluate these companies and come to the ones that you think are worth doing due diligence, then getting involved in that due diligence. So I just want to give a little context to this because I think even me, I, I look at the schedule and I'm like, oh, that's a lot. But, um, it's a great time. And then the other thing about kind of the networking, I don't know if anyone else is like this, but I hate that word. And I don't think of this as networking because this is— I don't know, but like, I just, I want— for, for new people in particular, I think it's just, um get to hang out and meet really cool people. Yeah. And I feel like every single time I have a conversation with somebody I don't know, I just learned something that's— I'm like, oh my God, this is— this person's the coolest person. So it's, it's again a lot of these things with built-in time, um, in-person time, and then that networking time. It's really time to get to know each other in a way, uh, you know, that every time you come back you feel like you're coming back to a group of friends and not just, you know, this cohort of investors that you're going through this process with. So I just want to kind of add that flavor.

I, I'll be honest, I was so scared when we took over this program. I'm like, every Tuesday, but I, I love it. I look forward to it. I am excited that I get to see all these folks every week. So the other thing that Hans always likes to point out is with The times that we're with the companies, we're with the companies. And maybe, Hans, you say it really nicely. You know it, the talking to the companies.

Oh.

Ja, I mean, the in-person events where the companies come to present is where you really get excited. You're going to feel, frankly, a little overwhelmed when you look at 149 applications and just 1-minute pitches. But we're going to— well, Neal will explain. We're going to screen this down to the companies that get to present to us. Then you really get to talk to them. You start to really be impressed by those who've been to that tier. So especially those ones that are highlighted in yellow, that's where the companies, most of them will come out, especially if they get to the later rounds. And you get to talk to them. That's why we make sure there's some flex time in there. We don't try to cram all the pitches into one day. You can have a glass of wine with them, you can chat, and this is where you learn a lot. And this is where you get a lot of inspiration from, from the, uh, from the, from the founders. So maybe that's what you wanted me to talk about, but that's exactly—

yeah, I think you, um, you always say that so, so well, and it is a valuable time. Not all of the— not until the top 6 do they have to— no, top 12, they have to be in person, or top 6.

I'm sorry, top 25, they, they come in person?

No, they don't have to.

Oh, they don't have to, but we invite them to.

We encourage them to. Okay, so these are the two events. These are what's happening next week.

Yeah, so we've got 149 applications. We've got over 70 people who have expressed interest in learning, and we're in various stages of that. Today is part of that learning if you want to engage further. And then we start tracking because our fund says we cannot officially be a fund until we have signed documents. And units committed in document. We are at 17 documents signed and 22 units committed, and we'll be a fund of 37 units. So we're close, and appreciate everyone who's already done that. I know a lot of you are in various stages emailing me saying, "I'll sign soon, I'll wire soon." My team's working on that. Thank you, appreciate it. Is Ashok here? No, soon.

Okay.

Scott, I want you to talk about This again, just bring it back. And, uh, if anyone wants to take a picture, this is Neal's contact information.

You have any questions?

The only thing to know is .co, not .com, which I did. People have done it, it's okay.

Um, so this is really what does success look like. We touched on this a little bit, but now that we've talked about everything, I, I actually think you talking about the agenda and why you came up with the agenda that you came up with would be really good.

Okay, sure. So the agenda today, and really about learning like what is angel investing and what are the things that people have already learned and spent 20, 30, 50,000 hours on that we could get almost as cheat codes. Okay, so that's, that's what I hope we espouse from today a little bit, right? Learn from others, learn from people's misses, gains, and what we'll do different today and tomorrow. And so I'm taking you through a few different lenses. I'm taking you through the lens of founder to funder, which will be the first conversation, and then funder to manager of a fund. So this is— and we'll get to that. Then also taking you through— oh, and with that, what are the kind of the roles and expectations of of an angel, once you kind of throw that hat on, put it on your LinkedIn saying, I'm an investor. Okay, what did you just open yourself up to? And what does it actually take all the way to deploying capital? So we're going to talk about that. We're going to use storytelling, especially with a lot of these guests today, not just kind of rapid-fire questions, because we learn a lot through people's learnings, through their own synthesis. We're then going to talk a bit about the— from some seasoned entrepreneurs and investors, how they have learned over the years, what are their frameworks for assessing and then identifying and investing, and why they have chosen to hyperfocus on local. Okay, so that's another angle here. There's a lot of different places you can go and invest, right? Why in our own backyard? Why right here where we live? So we'll touch on that as well, and kind of the importance of having a local capital community. What does that actually do for our entrepreneurship community? What does that do for the quality of startups when we actually have domestic capital as well, which we'll talk about? We'll talk a little about frameworks. So how do we actually evaluate at different stages, right? When we've just met a company versus we've met them many times, what are the different things we're synthesizing? And what are the things that we actually need to have like a checkbox to make sure we don't miss on financial, legal, IP, those aspects. We'll kind of talk through all of that as well. Writing a check, we will actually have from the attorney's perspective what is the legal aspect of writing a check and investing. There's a bunch of both vehicles that we invest in to make sure that we're investing appropriately, legally, and protecting ourselves. And then what are all the pieces that we need to do to actually fund the company. So you'll hear from an attorney around that. And then I have a fireside chat with a VC and a portfolio company to talk about the full process all the way from when they met them, just how they got to yes, and what's the relationship post-check. It's actually a part that is pretty important. How do you continue to add value? Because adding value actually maximizes your potential return and maybe increases the value of the company, which is good. For you as an investor. So that's kind of how I've thought through the day. I think you'll understand from the people coming up how and why we're going through this. Any other questions to make sure, or just things they want to make sure we touch on that is just already an open question in people's mind?

Yeah.

—make it up to a dollar amount, and how they are going to be— that's why I say you're selecting 2 to 5 companies, and to deploy equal amounts to each company, or depending on the stage of the company, to each decide— Yeah, and we didn't actually plan to touch on that today, so you didn't miss it. The fund documents say that we can raise between $200,000 and $2 million. So we can raise legally anything in between there. We have to raise $200,000 to have a fund. It's actually $203,202. We have to hit a minimum of that, I think, and then we have a fund. We can raise up to $2 million. And we as a group get to decide how to deploy that. So the membership base gets to decide that. In fact, it turns out it's the active members get the vote on how that's deployed. So how much, and how many companies, and at what amount per company. That is actually part of the process of deciding how and what to invest. I'll give you stats from the past. So we've invested anywhere— Is one vote, is one unit?

Do you want to just clarify that for anyone new?

Sure. So you get up to 4 votes as an active investor, and it's per unit that you invest, you get one vote for that. So $5,500 per unit. You get up to 4 votes if you invested 4 units. Does that part make sense? Question. We're touching base on the taxes benefits. Maybe actually, is this investment related on some tax benefits? We will touch, we can touch base on that. Yes, there are some tax benefits for being investing in private companies. By federal SEC or IRS rules. There are not California tax benefits to it. But yes, we will talk about that. And I think I'll pull that in knowing that as a question. I'll make sure we touch on that in a few different of the speakers throughout the day.

OK, and then you want to talk about deployment, maybe, or can you start?

Deployment. So yeah, deciding how we invest happens at San Diego Angel Conference on May 29th. We actually get in a room and we put our heads together and decide on the amounts. Now we will have already had some discussions about that, right? Definitely by May 29th we know our total fund amount for sure by then. Well, actually no, we don't know our total amount. We can't because people can continue to join after May 29th. So we know roughly how much we have. We know that the amount could go up, and so what will probably happen is a percentage of fund is what we'll decide on. So this amount— we have 100% of the pie, we're going to decide 20% to this company, and that check may increase over the next 2 weeks as more members join because of who we decided to fund at Angel Conference. So that is a potential. So we're going to decide who to fund, but we actually aren't going to know the check size at that day. And last year Last year we ended up with $440,000, I think, to deploy, and fully deployed that into 3 companies. And then what happened is, so what happens throughout the years is people say, I want to fund the 4th company or the 5th company, and they'll do that on the side, and maybe a side vehicle will come to fruition for certain members to just put a few dollars into a different company as well. So there are other investment opportunities that spin out from the investment day.