Ask HN: Why join a fund when you can be an angel?

2 pointsanthony_james3 comments

I'm curious what the financial advantages/disadvantages are of joining an established fund (and the costs incurred in doing so), instead of being an Angel. I assume the network opportunity is a big advantage - but is there any financial gain to joining a fund?

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I would say that risk is the big difference. The ratio of discreet winner to losers is very low compare to a fund. Of-course if you're lucky you can hit the lottery with one of your companies as an angel that would make up for all the bad ones. That's why you need to be able to have many investments (also known as lots of money) and be able to curate each one of them.

Diversification, if that is happening in the fund to any realistic measure.

Can I also diversify if I invest in a diverse portfolio as an Angel? or is buying into a venture fund similar to buying a mutual fund?

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