The Open Angel Forum Is Awesome (or, Why I Love Entrepreneurs)

A few months ago, Mahalo CEO and web presence Jason Calacanis sent out a message to his 17,000+ email subscribers railing against the practice of charging startups to pitch to angel investors. The tirade garnered a huge response, and most of all, crystallized the fact that Jason was going to do something about it. His activity since then is affirmation of why an entrepreneurial mindset that leverages resources, builds coalitions, and doesn't wait for permission is such a disruptive force.

The basic injustice that Jason was so angry about was the notion that Angel investors (in his parlance the 'rich people') would charge the 'poor people' (the startups) $1000-$6000 for a 10-15 minute pitch slot. He considered this (and I agree) predatory behavior. What's worse, many of those rooms were filled not with grade A angel investors (the group likely to make seed investments in new companies), but vendors and service providers who wanted to rope the startups in for legal work, etc.

More than just tirade however, Jason's first email actually named five angel forums who were charging, and how much they were asking. He called publicly on each of them to eliminate their fees. One group, the Keiretsu Forum, subsequently dropped their fees for companies looking for less than $500k in investment, and who had less than $500k in revenue. Of course, publicly they stated that the changes had nothing to do with Calacanis' outsized capacity to distribute angry messages and mess with their brand...

But the action hasn't stopped there. Calacanis, who is one of the co-founders of the TechCrunch50 conference (an event that was itself founded in response to how much DEMO charged startups to present), has launched the Open Angel Forum to put his beliefs about angel investing into practice.

The Open Angel Forum, which already boasts folks like Digg founder Kevin Rose as investor members, was founded not to grab equity and pricey fees, but as an event company that creates a safe, compelling, and most of all free space for investors to meet entrepreneurs. In fact, the only ones being charged are the service providers like legal firms who can grab one of the five $1,500 tickets for them. In other words, dinner is on them.

All in all I just think the whole thing is friggin awesome. First, I completely agree with Calacanis' mission in this case. Anyone who is trying to be an intermediary between entrepreneurs and investors needs to be dogmatically focused on increasing the flow of deals and reducing the friction between the right type of people finding one another. Period.

Second, and moreover, I think it's testament to the entrepreneurial approach to life. Dude recognized something he found to be an injustice, and subsequently leveraged every part of his portfolio - his big ol email list, his connections to other industry folks, his online TV show, and probably a bunch of things I'm not remembering to list - to both shift the behavior of existing actors and launch a highly visible alternative.

Any readers presenting at the January 14th event? It should be one for the history books.