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Last Update: Saturday December 7, 2019

Key Idea: Learn How Investors Think

Fred Hoar was a founding member of Silicon Valley's Band of Angels.  You also meet Hans Severiens, founder of the band, on his right (our left).  They told us that angels find the stock market boring.

Key Question:

A: 

These angels told us you need a cool idea and a cool leadership team.  These men were both approaching their 70th year and it was interesting to hear them speak this way.  We believe that a key to their success in investing is that they are tuned into what is going on now, not what was going on when they started in business decades ago.

They also made it clear that angels want to make plenty of money -- they are not interested in an idea for the sake of the idea.

Q:  What is an angel and how is an angel different from a venture capitalist?

A:
  An angel is an individual investing his or her own money, whereas, a venture capitalist like Vince is a professional investor using other people's money.

Q:
  Why is Silicon Valley so good at producing great companies?

A: No one in Silicon Valley sees failure as bad. When it's OK to fail, people try harder and try more outrageous ideas. Then, once in awhile, an idea turns into Hewlett Packard, Apple, Netscape, Excite, Yahoo and so on and on. 

Think about it

Do you know someone who knows someone who could be an angel for you?  Is there a "Band of Angels" in your town?  If you don't know, how could you find out?

Clip from: The Enterprise Network

Santa Clara and San Jose, California: Silicon Valley is famous for technology startups and its goal is to never lose the distinction of being "the place" for innovation. The Enterprise Network (TEN) houses over a dozen start-ups working to bring new technologies to the marketplace. At TEN they find low-cost office space and mentors who guide them. You will meet the men who run the incubator and a number of the entrepreneurs who depend upon the leadership and camaraderie offered here.

According to the National Business Incubation Association, there are about 5,000 incubators worldwide with about 1,100 in the US. 

We chose this incubator because it became famous during the dot-com boom and it is situated  close to Stanford University. 

Stanford was early to the idea of technology licensing.  Technology licensing has assisted faculty and students in the process of launching companies which in turn have created thousands of jobs and brought millions of dollars into Stanford University.  Stanford enjoys the "success breeds success" principal so things are popping there.   In this program we go to the campus to see how one PhD student is working to commercialize his discoveries.

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The Enterprise Network (TEN)

Mark Godwin, President & CEO

Access Growth LLC
2953 Bunker Hill Lane Suite 400
Santa Clara, CA 95054
408-893-4500

Visit our web site: http://accessgrowth.com

Office: 408-893-4500
Toll Free: 877-256-4500

Business Classification:
Business Incubator - NGO

Year Founded: 1993

Learn How Investors Think

HATTIE: (Voiceover) Why do technology start-ups have such success in Silicon Valley? Angel investors Hans Severiens and Fred Hoar explain.

FRED HOAR (Technology Investor): We've been the seed bed, here, of the microelectronics revolution. And it's largely been due to the availability of capital. And what's happening today is the most exciting scenario probably in the history of the world. And I won't go on and on other than to say that one of our executives out here -- and Hans has heard this story -- said that when he was in college, he used to dream, you know, he'd have a reverie about what would it be like to be in the years of the Athenian democracy or the Italian Renaissance and then he thought, `You know, living today, the progress in human achievement is greater by 10 than those two civilizations combined.'

So we are living in a period, at this end of the 20th century, that's never been duplicated before.

To be engaged with that, as an investor, as a watcher -- somebody said they wanted to come from one of the local newspapers to see our band of angels because they wanted to sense what he called the zeitgeist, which is the spirit of the time, and he said he thinks he could get it with this group of 100 people and the people coming before us to get funding, with their ideas, whether it's a new liquid crystal thing for cars, whether it's a new automotive anti-collision thing, whether it's security, whatever, because he said `You know, you're concentrating all of that.'

Well, we're lucky to live where we are, but that's Silicon Valley. But there are things happening in Miami, in other areas. There are certainly things happening in the Midwest, et al. So there's no monopoly on innovation here. What there is, is a tremendous amount of energy here.

This area is the site of the greatest legal creation of wealth in history, but at the same time, it's also the site, perhaps, of the greatest number of foul balls, or . . . you know, dry holes, and that's OK. Because failure is not a stigma in Silicon Valley at all. As a matter of fact, they say you're really not seasoned until you've had a couple of those under your belt.

HATTIE: Right.

FRED: (turning to his colleague) Wouldn't you say?

HANS SEVERIENS (founder, the Band of Angels, a technology investor): Well, failure here is not necessarily held against you. In fact, some people consider them assets because now you've learned how not to do it. We have a belief here in this country, and particularly in California, which I think has to do maybe with the frontier mentality, about, hey, if you work hard enough, yeah, a bunch of people are gonna die, but you're gonna make it. You're gonna get to that gold mine. You're going to get to the cause,  you're going to get these wonderful things, and, therefore, people are much more willing to accept risk. They know how to manage risk.



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