There's a reason people typically picture angel investors as Silicon Valley billionaires in hoodies and jeans, handing out $100,000 checks like it's no big deal.
It's because this world used to be reserved for the super rich and well connected. You couldn't even try to invest in startups unless you were an accredited investor - in other words, someone with a net worth well over $1 million.
Today, the landscape of angel investing has transformed into something that's a lot closer to the American Dream. Now, anyone at all who wants to strike Silicon Valley gold can do just that as an angel investor.
It's an exciting new world of opportunity out there. And it's all thanks to one big legislative change that has opened up a lot of potential for "regular" investors...[mmpazkzone name="in-story" network="9794" site="307044" id="137008" type="4"]
Putting the JOBS Act to Work for Regular Investors
Title III of the Jumpstart Our Business Startups (JOBS) Act was signed into law in 2012 and went into effect on May 16, 2016.
One big change the JOBS Act brought about is it allowed startups to publicly advertise when they are seeking investors. This is called "general solicitation." It was banned by the U.S. Securities and Exchange Commission (SEC) for more than 80 years.
That meant you had to be an insider to even be privy to angel investing opportunities in the first place.
For the most part, this massive profit potential was restricted to those who had some connection to the high-powered early investing crowd.
Now, you can access an endless number of deals online - in just about any industry you can imagine - on equity crowdfunding platforms.
These platforms, like WeFunder, Republic, and StartEngine, are basically online marketplaces where a founder can post a detailed profile of their business, along with their pitch deck, financial information, answers to interview questions, deal terms, and tons more information - all in one convenient place.
Investors can browse these listings, do some research on each startup, and even go through the deal process online.
If the startup reaches its funding goal, investors get their stake in the company (whether as equity, debt, or dividends - each deal is a little different).
If the startup fails to convince enough investors, everyone gets their money back.
Still, for a few years, only accredited investors were allowed to play the game. Everyone else was confined to the spectator stands.
But another part of the JOBS Act has changed that. Title III allows anyone to invest in startups, regardless of income or net worth. There's no minimum salary requirement to get started.
There are still rules about how much you're allowed to invest each year based on your income, because angel investing can be a bit tricky.
But not to worry, that's why you have me to guide you every step of the way, which I do regularly in my free Startup Investor newsletter.
You also need a good strategy, like mine, to turn a profit. The SEC doesn't want anyone blowing their life savings on a bad investment strategy.
That's why I developed the 1,000x Formula. It's a simple formula I use to determine whether a startup has the potential to kick back 1,000x returns - or if it's likely to flop instead.
Originally, I developed this formula for private deals... the kind you won't see on any crowdfunding website. But I came to realize something: This strategy can work just as well on equity crowdfunding deals as it has on private placements.
Follow along with me at Startup Investor to hear more about these deals.
We're Opening the Dealroom (Did You Get Your Password?)
Clear your schedule on Wednesday, Dec. 11, because we're doing something historic. For the first time ever, Neil and the research team are opening the doors to the Angels & Entrepreneurs Private Dealroom. That means you can join as Neil shares his next round of angel investments. Even better, you'll learn how to invest alongside him for just a few hundred dollars.
The only catch is that this meeting is strictly confidential. You are not authorized to discuss the research shared in this meeting with any non-cleared individuals. Neil is putting thousands of his own dollars into these startup recommendations... so he takes this very seriously. In fact, you will need your own password to attend this meeting.