Angel Investing Versus an Angel Fund: Robin’s Basic Understanding

Someone asked me how “angel investing” differs from an “angel fund.” Here is my own basic understanding: Taiwan has quite a few angel groups: Shi-Fu, Taipei Angels, NCTU, and AVA, run by JJ, an outstanding TTVC alumnus, among others. My understanding is that when an opportunity comes in, the team pitches and the angel group discusses it thoroughly. Each angel can then decide individually whether to invest. Angels essentially invest their own money and take responsibility for their own decisions. --- In my own basic understanding, an angel fund can also be considered a form of institutional investing. Everyone puts money into a pool that invests in relatively early-stage opportunities. It does not have the same flexibility as the angel groups described above, where some angels can invest while others decline. The money is pooled under unified management, so ultimately there can only be one decision: invest or do not invest. The investment stage, amount per deal, conditions or maturity of each opportunity, and post-investment management involvement may differ from what people generally associate with VC. But looking closely at how the fund itself is constituted, I do not think the difference is necessarily large. --- Angel groups generally collect membership fees to operate the organization. Angel funds charge management fees—say, 2%—to run the fund, along with a share of investment profits after an exit—say, 20%. --- All of this is a very preliminary understanding. Angels and people running angel groups or angel funds are welcome to add to it.