I once met an individual investor at Copper State Brewery in downtown Green Bay. 

Let's call him Drew. (If you’ve been to Copper State, Drew and I were sitting at the high-top table at the end of the bar by the stairs.)

Drew was sharing with me about his previous angel investing experience. 

He'd invested in a couple of startup deals over the past decade. Those deals went sideways and he lost money. The ones that were still active held an unattractive growth trajectory. No exit on the horizon. Drew’s investment from years ago had funded what essentially had become a lifestyle business for the founding team.

Because of this, Drew had more or less written off the angel investing category. 

Now, I have heard stories like this before, and the stories often fall into a similar pattern. 

Here is the pattern I expected, and this is exactly what had occurred:

✅ Each opportunity came from his own personal network - who he knew, or those who others in his network knew. ✅

Drew liked the founders of these deals. He ended up writing a check, mostly on a feeling, and seemed like that he had no one in the room to call BS through the process. 

But honestly, this is not unique.

✅ Drew is not fictional. Drew is real.

I'm just going to say it - there is a whole class of capable, capital-rich business owners or executives in this region and state that are like Drew. ✅

They got burned on one, two, or three deals. They told their friends about how it didn’t work for them. The whole asset class got written off... but not because it doesn't work. It is because of how they tried it.

A new future has dawned.

I am evangelizing a different process and a different future. Not because I have wishful or optimistic thinking, but because the results speak for themselves.

✅ In 2025, the Tundra Angels portfolio companies raised $71 million in venture capital.

Our Tundra Angels portfolio companies are generating close to $100 million in revenue collectively. ✅

I share in order to set up the proper context so that you can understand where we approach this conversation from.

There's a specific way most people try to enter this asset class, and almost every part of it is set up to fail.

It’s a category of what I will term as the "disconnected angel investor." 

The investor is sophisticated, but disconnected. They are disconnected from the proper networks that would otherwise asymmetrically increase the likelihood of a strong outcome.

✅ The disconnected angel investor is in a context where they: 

1) Only have access to deal flow that only exists in their own personal network

2) Do not have any other deal, or very few deals, to compare the one in consideration to at that snapshot in time.

3) Do not possess the expertise themselves or in their network to adequately vet it out. ✅

In short, they are disconnected from the bigger picture, resources, and insight of what it required to be successful investor in the venture capital markets. 

Let's go back to Drew to see how this plays out in practice: 

Drew, the disconnected angel investor, meets a founder. He is NOT seeing 10, 20, 30 deals at the same snapshot in time to be able to compare that single deal against. He can't tell whether the valuation makes sense because he's never seen, or, are not seeing, another similar one. He can't tell whether the team is credible in their domain because he don't have anyone in your network to ask. Or, the ones that he does speak with about it only speak from limited vantange points of experience. He worries the structure of the investment is wrong because they've never read a term sheet. He also doesn’t have connections to VC firms that can invest additional capital in the companies he invests in.

In the end, he hopes it works out.

But when the deal doesn't pan out, the loss is very real, as it was for Drew. 

But then people like Drew and others, maybe even you, make a conclusion - you decide the category doesn't work and you walk away. 

Yes, Drew, the disconnected angel investor, lost money. But in the process, he walked away from something that might have been a real fit, if done in a context with the right ingredients to increase the likelihood of winning. 

Contrast Drew with a the experience of a given member of Tundra Angels.

Tundra Angels actively sees deals and reviews funding opportunities from VC firms and angel investor networks around the state of Wisconsin and the Midwest. We also actively referr startups in our portfolio to other VC firms that are looking to invest. 

Here is an email that I received just one literally 7 days ago from an East Coast VC firm that invests $4-8 million in Series A startups. I met the Partner at the firm one year ago at a conference and we’ve kept in touch over the months.

This investor is coming to us, to Tundra Angels, to ask what deals they should be looking at. And we ask such investors what deals they are seeing in Wisconsin.

This is the network that we roll in.

No offense to Drew... but he cannot do this. 

But, just imagine if Drew were to compare that single deal to 15-20 other deals at the very same moment. 

Maybe that single deal wouldn't look so hot after all. 

Now, I want to be clear on something. It's not that Drew is trying to be disconnected.

But he's doing this ad hoc, disconnected from the network that is really needed. He is looking for deal flow ad hoc through personal networks, vetting deals sporadically, and tapping his own limited network. 

Here is how this works in practice for us. 

I continually speak to startups around the state and curate three or four Wisconsin startups to pitch to Tundra Angels on a quarterly basis (or virtually if there is a deal that we cannot wait for). After each pitch and Q&A, there is a five minute table discussion where investors identify two positives and two areas of concern. If you could listen in to a table, you'll hear what the supply-chain executive at the next seat noticed. You hear what the IP attorney across the table flagged. That's a reference frame you can't build alone.

Members also bring domain expertise to the table to help de-risk the opportunities. As just one example, on one of our financial technology investments, an investor/member who happens to be the C-suite of a major financial organization, wrote a multi-page diligence memo on the company. This investor really liked the startup's model. The rest of the group consumed his memo, knowing that this member possessed keen insight into the space that they did not.

That kind of context is what separates Tundra Angels from the coffee shop pitch of your best friend's cousin's nephew who got her MBA at University of Chicago and decided to do a supply chain startup. (As if I've never heard that one before). 

Deal flow even comes from our members too. Several of our future portfolio companies came to us because a member in an adjacent industry took an introductory call from the founder, then said: "Matthew, I think you should take a look at this." I run my typical process on the front-end. They sometimes don’t make it past the first meeting. But other times, the deals that our members refer me to are so compelling that I selected them to pitch to the Tundra Angels group and we end up investing. 

Net net, after a few pitch meetings and a couple of due diligence cycles, investors build a frame that takes years to build in solo angel investing - the frame of which companies to pay attention to, and which ones to not pay attention to. You start to see patterns. You know what a vague projection deck looks like because you've passed on five in the past. The learning compounds because the network compounds it for you.

One member who joined Tundra Angels had done angel investing previous as an individual. They discovered their own deals, vetted them out, and executed the investments themselves.

When I met this future TA member, in that meeting, he told me that he really liked the Tundra Angels model and remarked to me, "I won't be a lone wolf anymore."

This was a powerful statement.

Pairing this “lone wolf” comment with the lens of this article, this member was essentially telling me, “I have operated like a Drew. And it was hard.”

“But now, in joining Tundra Angels, I won’t be like a Drew anymore. I won’t be a lone wolf anymore. Angel investing won’t be all up to me.” That is the thing that made him excited to join.

What this member wanted, and what most people should want when they're entering this asset class, is to stop carrying every part of the decision alone. You don't give up control, as investors in our group decide deal by deal, at their own check size, with no fund commitment that locks them in for years. 

The point is to connect up with the context - the deal flow, frame of context, and the investor network that is needed to asymmetrically increase the likelihood of being success in angel investing. 

Again, I'm just going to come out an say it - a whole class of capable, capital-rich business owners and executives in this region and state are like Drew.

They got burned on one, two, or three deals. They told their friends about how it didn’t work for them. The whole asset class got written off... but not because it doesn't work. It is because of how they tried it.

I may not sit across the high top table at Copper State Brewery with them, but I know some are out there. Reading this right now.

That's the part I want to fix. Not by selling anyone on a particular deal. But rather by being a network and a context that helps give angel investors the highest likelihood of being successful investing in high growth startups. 

This newsletter is a piece of that. And, hey, if the valuation markups of our portfolio companies are any indication, we are well on our way to experiencing the wins of future success.

If this resonates with you at all and the experiences that you have faced, I’d love to hear about it.

See you next Wednesday.

-Matthew

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