In this day-and-age, it would make little sense for angel groups to charge to present. For one, I know they wouldn't be able to grasp or appreciate the captial light nature of my startup.

Somehow/someway I've managed to spend <$1,000 despite recruiting a stellar team of passionate & talented individuals around me.

Considering my core team has been putting in their sweat equity, we've had three expenses (cloud hosting, contracted grahic design work and…business cards!) and I surely would not make presenting to an angel group a 4th

-Adam

Well said…. well said. Interesting side notes about how many start-ups are spending more time pitching than building the business… I know you need to do both, but if you don't sell, how is there a business???

I think the same can be said for the websites that charge a monthly fee to "feature" your startup in a listing to potential investors. Sure, the sites cost something to run, but when the only offers anyone is getting are from another company that wants you to pay in order to get in front of people, it's just another layer of insult. And I would be very surprised if investors you'd want to work with are involved in these sites?

The best way I can put it is that it feels like "paying somebody to be your friend"

When you pay to get the opportunity to talk to somebody it always feels like I'm paying to be your friend.

I've never been able to get past most of the CEO networking groups because it just feels like this. I've organized one, but the only payment you have to make is playing credit card roulette for the tab. (second to last persons card picked from the hat by the server pays the tip, last pays the tab)

Sometimes, I even get this feeling when going to conferences meant to talk about the industry….

I would also agree with your definition of an angel, having at least 25K in the game in the last twelve months. As an entrepreneur I would ask this question of potential angels. In many groups, only a handful do any real investing and that makes the supposed efficiency of pitching to these groups lower than it would appear..

I think it is more then trying to cover the operating costs of the group. I have heard that for many groups this is a way for entrepreneurs to self-select out. Most groups (VCs as well) receive hundreds of business plans that have no chance of investment or do not even come close to meeting their guidelines. Thus, if they are willing to pay fees – they receive a lot less of the "junk" plans.

I agree – most investors must take the good with the bad and hitting the business owners for it seems a bit below board.

Fast forward a few years, after having become an active angel myself with Keiretsu in Seattle and now living in Denver… I decided to work with the group to launch a CO chapter. While our model does include fees for the final presentation, I have been very sensitive to the local environment, and have tried to keep fees in line with our activity. We started out free, raised to $500 after we made about $500K in cumulative investments, and raised again to $1000 after we hit 25 active members and about $2M in cumulative investments. I've stayed at that level since (though most US chapters are around $1500) due to the ecosystem here, even though we've surpassed $5M invested in 19 deals since kicking off in March 2007. We've had a fairly high funding rate (at least until late last year…), and we let entrepreneurs come back for free to give updates as they continue to work on their raise. In all, I still feel this is fair and cost-effective to the entrepreneur.

(more)

I've been an angel investor for 15 years, have run an angel group for 7 years and have invested > $500K in 10+ companies. I have never charged an entrepreneur to present nor has the group I belong to–nor will we ever do so! The vast majority of angel groups do not charge a fee. Obviously, the NYT article was meant to be sensational–and was successful….

Brad, I think you went a little overboard with your post. I have referred a number of people to the Keiretsu Forum because it seems to me to be a credible organization run by people with integrity. In particular, the Denver chapter seems to have done a great job starting from scratch just a couple of years ago and getting a meaningful amount of funding to entrepreneurs. Paying $1,000 to get in front of a qualified group of angels could well be worth it, when you take into account the amount of time it takes to build a credible network and the large number of un-serious time wasters you encounter along the way.

Hello Brad,
Thank you for setting up a great discussion.
Robert W. Price
Executive Director
Global Entrepreneurship Institute
http://www.gcase.org/

***
Below is information sourced from Angel Capital Association (ACA)

The Angel Capital Association is a trade association that supports angel investment groups in North America. ACA was founded by angel investment groups located in the United States and Canada to help maximize the success of group based angel investors.

ACA Guidelines on Charging Entrepreneurs Fees for Applications and Presentations
In 2008, ACA recommends that angel groups charge entrepreneurs no more than nominal fees for applying for and/or making presentations for angel capital and that all fees are fully disclosed, ideally appearing on the group's Web site. The fees should be no more than a few hundred dollars for applications and no more than $500 for presentations.

http://www.angelcapitalassociation.org/dir_resour…

Popular post. It boils down to this:

The only ones that really pay are those that do not get funded. And that really feels like picking on the short bus kids. What you are really doing is making the person that doesn't have a lot of money, and was unsuccessful in raising money pay all of the expenses. And an important point is that they are paying the expenses for the 19 people out of 20 that supposedly are wealthy but haven't put up any money in the last year, and are using the meetings as a social club.

If you get funded money will go towards the fee, so the angels in this round would really prefer there be no fee (why subsidize those that didn't invest)

The only people that should be screened by their ability to pay money should be…de da dee…..those that are there because they supposedly have lots of money.

I think that a company that needs to PAY to be listened to should not be listened to in the first place.

As simple as that.

Ok…so I heard lots of metaphors here like "paying for a friend" or comparisons like "paying for a pitch is like those who prey on young Hollywood wannabees, charging for auditions and screenplay readings". Frankly, I find this BS, you don`'t pay for a friend since you expect that "friend" to give you back hundred thousands more(you want him to invest, don't you?) and secondly, think of all the Hollywood wannabees,think of how many that have made it are completely useless, not to mention if you have in mind how many more there have been before the selection process.
To make a long story short and cut the useless metaphors and comparisons, I actually tried buying a database (it was the VCgate database http://www.vcgate.com ) and I will do it at anytime for the following reasons:
1. The price was not that high so I would bother complaining
2. They offered me great support and answered all my questions regarding their product (and i asked lots of them, they even told me how many potential investors they had on their list that would match my profile before i bought ir)
3. The database was already organized, i didn't have to trouble doing research at home and waste my time
And the list could go on, but the most important argument for me was that I would never trust to give my fund raising project (that I have worked so hard on) to anybody that can steal it or put their name on it without any further consequences. By paying a sum of money both you and the company submit to some ground rules that mention theft among other things (plus you can always prove the bank transfer so it becomes obvious that you had an arrangement with that company).
These are only some of the benefits of paying for any services,and the list may go on.
Like it was already mentioned, so far I didn't get any funds but I got some relevant reviews over my project and that was worth the trouble.

I think the venue you are pitching your company to should determine what the cost to present. As a prior angel, I have seen too much junk come through the door.
For every good idea that gets funded, there are thousands of other ideas that are unfundable.
We can't even get the banks to manage investor funds properly. How can we expect startup entrepreneurs to do much better?
As an entrepreneur, you have to do your homework. You have to put it all on the line. I puke, when a startup entrepreneur comes to me with nothing to lose, or they say their wife will not sign to put their house on the line. So, I say, bye bye. Why should I work for free, listening to these jokers, when I could be working with entrepreneurs that know what it takes?

Couldn't have said it any better, Brad. Thanks.
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so how do I get a hold of an investor group where are thay at phone numbers are out of state . im in california and still not able to find one here.