Managing Risk

Essex's investment committee differentiates between concept risk and execution risk.

We invest in Execution Risk

Execution risk is determined by the likelihood that a startup management team can deliver a successful product launch and scalable operations within the stated timeframes and capital requirements:

  • Ability/track record to scale and organize orderly growth
  • Logical and actionable business plan
  • Launch product or service on time and in budget
  • Meet market demand profitability

We do not invest in Concept Risk

The business model, the product or service concept and market validation constitute the concept risk and effectively determine whether a business has any chance of succeeding:

  • The business model may not be viable
  • Product or service is not competitive, including price and features
  • Market validation weak or unsubstantiated
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