The New Jersey Entrepreneurial Network will hold its annual “Gathering of Angels” — an event meant to help match up investors and companies on Wednesday, June 6 (see story page 6).
While John Ason, a well-known New Jersey angel investor, won’t be attending this year’s event, Ason does have advice and information for anyone interested in the world of angel investing.
Ason has been an angel investor for more than 14 years, specializing in early stage pre-revenue companies. For about half of his investments, Ason has been the lead angel, devoting a significant amount of his time to mentoring the companies.
He has made about 40 eclectic investments in the areas of e-commerce, technology, advertising, digital social media, and entertainment. A frequent participant at Venture Associaton of New Jersey events, he also gets referrals from lawyers, accountants, and service providers.
Ason, a resident of Westfield, was born in Germany and grew up in Chicago, where his father worked in furniture factories and his mother was a cleaning lady; his parents were from Poland, where they were farmers.
Prior to being an angel investor, Ason worked at AT&T Bell Labs for 25 years, first involved in software and technology development, then in marketing and business management of large telecommunications projects overseas. He is a graduate of the Illinois Institute of Technology.
All along Ason had also earned money in the stock market, and when he retired in 1996, he gradually moved into angel investing.
Following is a question and answer exchange Ason conducted in with New Jersey Incubator Magazine in 2011 that was reprinted in the May edition of the Einstein Alley E-newsletter, “Right Up Einstein’s Alley:”
Q. How did you get involved in investing in emerging companies?
I spent 25 years at Bell Labs: the first 10 doing bleeding-edge technology and the last 15 marketing and selling large telecommunications software systems overseas. Being successful in the stock market, I used my emerging technology background and emerging market expertise and gradually started funding emerging companies.
Q. At what stage of an emerging company’s growth are you most likely to consider investing in the company?
I like to be the first professional investor in. Rarely will I do any investment after Series A unless I am an investor in the company already.
Q. What types of companies are of most interest to you?
My sweet spot is a company with one or two founders in a kitchen or garage. About half my companies fit this profile. I then look for some disruptive idea that could propel the company into hyper growth. Lastly, the company must be intellectually stimulating.
Companies I’ve invested in include: Xlibris (www.xlibris.com), an internet self-publishing company; Tucker Toys (www.phlatball.com), a toy-inventing company; Bikini (www.bikini.com), a beach culture website; Geometrix, a company that creates 3D models from 2D video; MakeUsAnOffer, an automated internet haggling site; and Hooja, a mobile search company.
Also Centrak (www.centrak.com), a real time location system; Fulcrum Gallery (www.fulcrumgallery.com), a company that sells internet posters; Calluna Winery (www.callunavineyards.com), a startup winery; Livelook (www.livelook.com), a social e-commerce platform; IvyExec (www.IvyExec.com), an electronic job board; Ology (www.ology.com), a Gen Y blog aggregator; TheHotList (www.TheHotList.com), a social discovery engine; DoodleDeals (www.DoodleDeals.com), a website that offers daily deals for mothers; and Diapers (www.diapers.com), a website that sells diapers.
Q. Do you look at companies in a particular geographic area? If so, what area?
I consider companies in New York, New Jersey, Pennsylvania, and California. I currently have started to look at companies in Israel, Canada, and Sweden.
Q. What is the best way for an entrepreneur to approach you about investing in their company?
The best and only way is to send a one-page executive summary to email@example.com.
Q. What are the things that are most important to you when you are making a decision of whether or not to invest in a company?
I am looking for a pleasant long-term experience that has a decent chance of getting into hyper-growth. Any low-capital industry with high-growth potential qualifies with the exception of medical and biotech.
Q. How long, on average, is the time before your initial contact with a company and the time you commit to investing in that company?
My shortest commit time was 28 minutes; a soft commit rarely takes more than two weeks.
Q. How involved are you in the companies in which you invest?
I do not do any operational work. I prefer to work on an as-needed basis in areas like structuring the company for hyper-growth, getting additional funding, getting introductions, and hiring people.