“I think I can get Dobkin to invest in us,” “Randy,” one of my co-founders, said to at lunch. Randy had just officially joined our company, and we were talking about fundraising.
“Bob Dobkin?” I said to Randy, trying to hide my excitement. Dobkin was the co-founder and CTO of Linear Technology, one of the most successful startups in our space ever. That’s why I couldn’t hide my excitement, so I said, “Are you fucking kidding me!”
“He invested in my last startup, and I think I can get him to invest in us.”
Ideally, you want your angel investors to attract other investors.
Randy was an early employee at Linear Technology, so he knew Dobkin well. And, Dobkin was a legend in our industry. He had over 100 patents, and his innovations had been a large part of Linear’s growth to over $1 Billion/year in revenue.
In other words, Dobkin knew what he was doing. I mean, this guy knew the analog IC industry inside and out. If an investor was interested in the space, then Dobkin’s vote of confidence would get us over the top.
“When can I meet him?” I asked Randy.
“Let me reach out to him,” Randy replied.
Ideally, you want your angel investors to add value to your company’s operations.
A week later, Randy and I were having lunch with Dobkin at the California Cafe in Los Gatos. I’d never met Dobkin before, so I didn’t know what to expect.
We’d been competing against each other for years. Me, at Maxim, Linear’s chief competitor, and Dobkin at Linear.
We shared war stories of our past, and we got on quite well. Then, I walked Dobkin through our pitch.
It was an updated version of the same strategy that Linear had built their company with. Dobkin liked it.
“I’d like to invest,” he said.
Then he went a step further. “I think I can help you recruit because I know some engineers that would be good fits for what you are doing.”
“That would be great,” I responded.
Not only were we going to get someone whose brand was going to significantly help us find investors, we were going to get someone who was going to help us build our company. It doesn’t get much better then that.
Ideally, you want your angel investors to be low maintenance.
After we closed our funding, our office was maybe ten minutes away from Linear’s headquarters. Every once in a while, Bob would drop by to say hello.
My favorite memory of Bob’s visits was when he would draw circuit ideas on the white board in my office. You had this absolute legendary genius brainstorming ideas with you. How cool was that!
The best thing about working with Bob as an angel investor was the relationship was easy. I would call him at home every month to update him in our progress.
The calls always went the same. “Hi Brett!” Bob would always sound really excited to hear from me.
Then I would update him on our progress. He would ask me some questions, and he would offer help and advice.
Bob also had a relationship with “Raul,” one of our two venture investors. He knew what Raul was about, so he would always ask me, “Is Raul causing you any trouble?” I appreciated the support.
Ideally, you should never take an angel investor's money if they are going to be difficult.
About six months into our operational life, I made the difficult decision to fire Randy. Randy was causing a huge amount of disruption inside our office, so I knew he had to go.
The question I had was how would Bob take the news. I called Bob at home the evening I fired Randy, and I let him know that Randy was terminated.
I explained why I terminated Randy, and then I waited for Bob to respond. He said, “Okay. How’s the business going.”
It was the perfect response. He could have made my life difficult, but he choose not to.
I’ve worked with CEOs who had difficult angel investors. It becomes a real time burden when you have an investor that is causing you pain. In fact, I worked with one CEO who gave one his angel investors their money back because the investor was so disruptive.
Ideally, you want someone like Bob to be your angel investor. Someone who attracts other investors (which he did), adds value to your business, and isn’t difficult to work with.