Some persuasive data

There are very specific reasons VCs follow on that absolutely make sense (more later). But angels are not small VCs.

AngelList analyzed all the investments made on their platform over the past 10+ years. Their takeaway was that for early-stage tech investing, individual angels should NEVER follow on. They coined the term “infinite regret” to describe what can happen if you follow-on instead of making a net new investment. That’s big talk!

Recent posts from Harry Stebbings looking across the industry suggest that doubling down on Series A and Series B “winners” may also be a false flag in pursuing the best financial outcomes - even for VCs!!

This is provocative stuff. We’ll talk about it more later.

In other categories of investing, such as CPG, the math can look different. But the reality remains that unless you are writing a big check directly on the cap table - not a small check through an SPV — you likely won’t have the opportunity to “follow-on”.

Hot Take: Angels are not small VCs