Angela Lee is an educator, entrepreneur, and investor. Angela is a Professor of Practice and the Chief Innovation Officer at Columbia Business School, where she teaches courses on leadership and venture capital. She started her career in product management and then moved onto strategy consulting at McKinsey. She is the founder of four startups, including the NYC-based investor network called 37 Angels, where she is an angel investor. Angela holds a bachelor’s degree from University of California, Berkeley and an MBA from Columbia Business School.
37 Angels is a community of women angel investors focused on helping female investors find and apply for funding from the world’s top accelerators. The name of the organization comes from the fact that only 13% of angel investors are women, and they want to get the number to 50%. Angel investors are individuals who invest their own capital into startups in exchange for ownership equity or convertible debt.
Highlights of our conversation:
Embracing happy accidents
“I wish I could say that I knew I wanted to be an investor, and that is why I became one. But it was kind of a happy accident.”
Angela started angel investing by accident. One of her best friends from middle school was directing a film aiming to promote mental health awareness in the Asian community. Angela had invested money in the film. It was at that moment that she became an angel investor…without even realizing it.
“[Mental health] a topic that’s very near and dear to my heart. So I wanted more people to see the movie. And I didn’t think about it at all as an investment. It was me helping out one of my dearest friends.” Angela claims that she “didn’t make any of my money back, nor did I expect to,” but “all of a sudden, I was an investor.”
Fortuitously, because people knew Angela was writing checks, she was put on email lists and was getting invited to events, being bombarded with deals to evaluate. And she looked at deals for a couple of years haphazardly, “furiously writing down every other word that these people were saying, because I didn’t know what any of them meant.”
Creating an angel network that included her
“I was 28 when I started angel investing, and I’m an Asian woman, and I walked into rooms, and nobody looked like me. I mean, I literally got asked if I was lost, I was asked whose money I was investing…how I made my money. I got asked all these inappropriate questions…I wanted a network that looked a lot more like me.”
In 2012, Angela decided she wanted to be more thoughtful about angel investing and wanted to be a part of an organization that included individuals that looked like her — racially diverse, females, and younger individuals.
Unfortunately, Angela emphasized, women are much more susceptible to imposter syndrome and gender bias.
“There was a very famous HBS study that was done that showed that men will apply to a job description, if they are checking off 6 of the 10 qualifications, the women won’t apply until they’ve checked off 9 or 10 of the boxes. And by definition, we’re all under qualified to be an angel investor, right? We’re investing in nascent companies in…brand new industries that nobody really knows about….Women are less likely to lean into that discomfort of ‘I don’t really know what I’m doing.’”
Moreover, Angela noted that the “average age when people start angel investing is about 50. And so the average age of an angel investor is probably 60…I wanted to invest alongside people who were in the prime of their career [like me].”
Thus, 37 Angels was born. The organization is composed of female investors, many of whom are former founders, who are relatively young. Investments are made in both male and female-led startups. In addition, turnaround time is fast — 37 Angels goes from watching a pitch to making a funding decision in four weeks. To date, 37 Angels has looked at over 10,000 deals. In addition, 37 Angels runs bootcamps to teach the lingo, philosophy, and math behind angel investing, and those that participate have access to a network of investors.
The four Ps
Angela broke down what 37 Angels considers when making investments. “ We break it into the four P’s in terms of what we look for, which is people, problem, progress, and price.”
Angela believes in “diversity in the team in all ways…whether it’s age, gender, race.” And while domain expertise is incredibly important, she also believes that teams should also include individuals with additional, complementary skill sets — not all physicians or all data scientists.
Moreover, investors — be they venture capitalists or angel investors — “want [to see] a really large problem,” such that they can get a sizable return on investment upon company exit, whether that means it is going public or getting acquired. Importantly, Angela also looks to see if the founder or the founding team understands what the problem is, what the pain points are of various stakeholders, and how the company will align with the interests of the various stakeholders to solve the problem. In healthcare in particular, Angela echoes that “customer empathy” is important. What does the doctor get out of this solution? What about the nurse, the insurance company, and the hospital system?
With regard to progress and price, Angela states that “some degree of traction is nice” and “the valuation needs to be fair.”
Final words
For those that want to get into investing, Angela recommends asking yourself “how much control do you want to have over the investment?” Individuals that want the most control are solo investors — they solely choose what they invest in. Alternatively, you can join an Angel network, like 37 Angels. In this case, Angela and her team take 2,500 companies and narrow down to the best 50 to introduce the angel network. The least amount of control is that you hand over money to a venture capital fund, and therefore act as a limited partner. In this case you have no control and trust the partners at the venture capital firm to make wise investments with your money.
At the end of the day though, Angela notes, “There’s no right or wrong answer.”
Interested in angel investing? Check out Spotlight on Women in Healthcare Ventures on Spotify and Anchor!
Theia is a 501(c)(3) non-profit dedicated to inspiring and empowering the next generation of women entrepreneurs and investors in healthcare. Visit our website to join our community and access resources that will support your entrepreneurial journey and pursuit of changing healthcare.
Story written by Luiza Perez , Priya Kumar, Katie Donahey, and Ankeeta Shah.
