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Pitching Angel Investors on Technologies They Don’t Understand

Daniel Faggella

Daniel Faggella is the founder and CEO at Emerj. Called upon by the United Nations, World Bank, INTERPOL, and many global enterprises, Daniel is a sought-after expert on the competitive strategy implications of AI for business and government leaders.

Pitching Angel Investors on Technologies They Don't Understand

Episode Summary: This week’s guest is Senior Vice President of SPARK, an economic development organization dedicated to getting startups and other early-stage companies off the ground in Ann Arbor, MI. Skip Simms speaks on pitching angel investors – specifically on how to convey complex technologies to investors who don’t necessarily have your technical expertise, and still close the deal and get the investment. Simms talks about companies he’s seen do this well (and not so well), and how aspiring companies can do a better job of convincing investors to get in on new or unfamiliar technologies, something many AI company founders will have to deal with in some shape or form in launching a new entity.

Expertise: Venture Capital & Private Equity

Brief Bio: Skip Simms joined Ann Arbor SPARK in 2006 as Director of Entrepreneurial Services and was its second employee. In 2011, he was named Senior Vice President. Skip oversees all the entrepreneurial activities including incubators, business accelerator programs, and all capital programs.

He was the architect of the Michigan Pre-Seed Capital Fund co-investment program, the multiple micro-loan programs managed by SPARK, and the MI Innovation Equipment Depot. His newest initiative is the Michigan Angel Fund. Skip has nearly 15 years of experience in financing and investments. Prior to joining Ann Arbor SPARK, he was the Managing General Partner at the Ralph Wilson Equity Fund, a $31 million fund-of-funds.

Current Affiliations: Senior Vice President of Spark; Board of Director Member for Michigan Venture Capital Association


Interview Highlights:

(1:10) You’ve likely seen founders presenting complex technologies…you’ve seen some probably hit it out of the park in terms of distilling complex technology and business models into something that really garners trust from an investor…what do the people who do it right do to convey something complex to a business person, an investor, like yourself?

(5:28) Do you hear of founders who are practicing this somehow, getting feedback to the point where they’re able to distill it, there’s probably some great companies that you folks have seen, that if they could have said it right in the first 20 minutes, you might have called them back…are there ways that you’ve heard of founders, or maybe even had founders tell you, of ways they’ve learned to convey this to investors and business people?

(9:53) What are one or two other pet peeves, things that when you see them, you already get that sinking feeling like ‘ya know what, I’m just not feeling like a second meeting is going to happen here’?

(12:23) How do you folk as business people and investors do your own homework’s…as to what is the validity to the technical idea here?

(14:42) When someone comes in with an attitude…it’s a dangerous thing to do if you’re a boss because you can garner resentment…the other side is, it might be a seed of a kind of hubris that can cause a business to fail, is it a combination of both that worries you and turns you off or one more than the other?


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