An Open Letter to Angel’s Gate

For those not in the loop, Angel’s Gate is a reality TV show where a respected group of angels cut deals with founders who pitch to them. Episodes are up on YouTube.

Dear Angel’s Gate,

I know that deep down, you’ve genuine intentions to build up the local and regional startup scene. You guys were all entrepreneurs, so I know that somewhere deep down…you actually care. And it’s TV magic at work.

But I digress.

What benefit do you truly bring to the ecosystem? Does turning fundraising into American Idol actually help anyone? These are founders who are driven by passion and have created something of value. But yet, you see value in scheming, lowballing and talking down to them on public television. The questions you ask, the way you analyze and suggestions you give - they aren’t particularly relevant for an angel. You glamorize what entrepreneurship isn’t about.

It’s clear that you don’t think that the “quality” of the companies are worth your time and money. You probably reason that companies whom are worth it don’t/wouldn’t need to appear on TV. By that logic, the same should same applies to investors - the good ones don’t need TV.

Yes, the ecosystem is still maturing. The funding landscape is not as competitive as it should be. But why the shitty deals? You are not on the level Techstars, YCombinator, and Angelpad. They offer so much more value for much less than the deals you cut. YC takes 2-10% for up to a $20k investment. And it’s YC. You take 10% just for advice? That’s absurd.

Here’s the thing: should you take advantage of founders to that extent, just because the market allows you to do so?

I’m sure I’m not alone when I say that your show does more harm than good. Here are some choice words by other serious players in the scene:

“@iamclovin: Being mean and offering stupid terms trivializes the effort of the guys actually building stuff.”

“@yongfook: that show has a very uncomfortable scumbag vibe. It’s all wrong, it should be the opposite.”

“@shadowsun7: Paul Graham says that YC founders deride VCs, and that quote comes to mind when watching Angel’s Gate.”

“@andycroll: Angels Gate has cheap looking sets and outfits to go with the cheap behavior.”

Perhaps I should approach this from your perspective. You aren’t getting a good deal flow, so you start a TV show, in an effort to raise your profile and get a better exposure to companies. But then you then skewer them, and give yourself a bad rep while doing so. And the sad cycle repeats.

I know that your intentions are genuine - you want to help founders by providing another avenue of financing. The idea is there. The execution just sucks.

When you were starting out, did the people who helped you treat you the way you’re treating the next generation? The Asian ecosystem badly needs to encourage more people to be founders.

You aren’t helping. Please stop.

I’ll leave you with a quote, which you should seriously reflect upon.

“Founders are the ones who innovate, investors are just lucky to be able to be part of it”

Ron Conway, SV Angel at Startup School 2010

This letter sparked a heated debate in the community, and was cross posted on Silicon Straits.

Follow up (March 25 2012)

Thanks for the responses. What a discussion and what an expression of the community towards the show. Kudos to William for his candid point of view as well. I do love an open debate in a public forum, just as he does.

To the Angels, and indirectly, their fans and and trolls: I’ve never doubted the intentions of Angel’s Gate. Like I said, the idea of the show is there, but the execution sucks. Entrepreneurship is hard. Reality is messy. Angel’s Gate is not reality, despite making itself out to be.

The primary interest of a TV show is ratings. That means the entire show is optimized for ratings. 15 second time limits to accept a deal. A guest Angel talking down to the founders while harping on silly concerns. But more importantly, the meaningful parts get cut out (as hinted by Guyi, William and Gabriel). Which means that the true value of the show, if any, gets shoved aside for the sake of entertainment.

As a result, we don’t get insights into how you - the angels - truly think. Where do your interests lie? As one commenter brought up, the show “cheapens the whole investment process, and makes it very unclear what you value. Is it the idea? The team? Revenue stream? The potential pay off?”. You aren’t consistent. The thought process of deciding to fund or reject a company is sloppy, especially for an angel round of financing.

Sure, we could just treat Angel’s Gate as pure entertainment, and take you with a pinch of salt. But I know that’s not what you want. You have lined up a great set of sponsors like Google, Amazon and Microsoft, who are great supporters of the startup community. So if your objective is to educate the masses about entrepreneurship, you should be held to a certain level of responsibility.

Entrepreneurship is still not a recognizable career path in the region. Like it or not, the broader audience will develop a negative perception towards entrepreneurship due to your production values. Most people aren’t familiar with the scene; they don’t know what is real and what is distorted.

We are in a maturing ecosystem. So it’s to your advantage that you can cut deals at terms unheard of in the Valley. Founders, due to a lack of options, will have to seriously consider them. But should you, or do you need to, take that advantage? Would it hurt to be more founder friendly?

The government, through schemes like the NRF TIS, is trying to fast track the maturity of the startup scene. Do your part by pushing beyond market norms with competitive deals. With the “clout” of a TV show, you can buck the trend. Maybe then would people take Angel’s Gate seriously, instead of the publicity circus it is now. Yes, founders are appearing on your show more for the publicity than the sage advice or the deals you provide.

I’m not asking you to go soft on anyone. Money given to a bad idea, or one who doesn’t deserve it, irks me just as much. Don’t waste time on crap. But just as you must be firm, you have to be rationally critical, and definitely respectful. Help the audience better understand why the idea bad. And stop smirking and scoffing in the background.

To be honest, I would much rather see you pick the top 10% of applicants to appear on the show, and fund the top 1%. That forces you to carefully deliberate over each deal. Understand their market. In front of a TV audience. Kind of like how Paul Graham holds his intriguing office hours on stage. Now that’s value.

If the producers and angels deem all that too boring for a TV show, that’s exactly why Angel’s Gate should stop.