Diana Lace Davidova's Guide to Smarter Angel Investing: Insider Tips for Maximizing Your Returns

Raimonds KulbergsDiāna Lāce-Davidova
Date published


Hey there, aspiring angel investor! Ever wondered how to best approach your angel investing strategy? We've got some insider tips just for you. In a recent podcast interview with BADideas.fund, Diana Lace Davidova, a seasoned investor and startup enthusiast, shares her insights and top tips for those looking to dive into angel investing. Let's explore her strategies, experiences, and advice.

Background on Diana Lace Davidova

Diana's got some serious cred in the venture capital world, having spent five years with Superangel.io & Overkill Ventures. During that time, she helped invest in over 40 startups! She's also a co-founder of Global Shapers Riga, a youth network powered by the World Economic Forum, and now Head of People at Whimsical ($30M raised from Accel). Talk about an impressive resume, right?

Advice on angel investing

Spotting High-Potential Startups

Ever heard of founder-market fit? It's a game-changer. Founder-market fit is all about the alignment between a founder's skills, experience, and passion with the needs of their target market. Diana believes that startups with strong founder-market fit have a higher chance of success. Why? Because they understand the market's pain points and can build a product that addresses them effectively - better than other teams.

And let's not forget about traction and growth. Consistent growth and increasing user engagement are signs of a product that resonates with its target audience, and that's what you want in a successful startup.

Due Diligence: The Heart of Angel Investing

So, what's the secret sauce to making the right investment choices? Diana emphasizes the importance of thorough due diligence. It's all about researching the market, product, and competition to make informed decisions. And don't forget to assess the founders! Evaluating their backgrounds, experiences, and values can help you determine if they've got the skills and drive to succeed.

Calibrate Expectations, Diversify Your Investments

As a first-time investor, it's crucial to calibrate your expectations. Most startups will fail, and it's important to be prepared for that reality.

You know what they say, variety is the spice of life, and it's no different when it comes to angel investing. To mitigate risk and increase the chances of finding that outlier startup that brings outsized returns, Diana recommends diversifying your investments. By initially investing small amounts in many startups, you can build a well-rounded portfolio that minimizes the impact of any single failure. Remember,

"You can't build a diversified startup portfolio with just a handful of deals."

This helps you weather market fluctuations and increases the chances of getting that outlier startup in your portfolio that brings outsized returns.

Join a Collaborative Community with High-Quality Deal Flow

If you're considering becoming an angel investor, you might want to check out BADideas.fund - early-stage angel syndicate providing €50K-€200K funding for CEE startups. We focus on collaboration and learning to help you build a diversified investment portfolio. Members and investors have experience building well-known companies like Twilio, Vinted, Printify, and many more. If you're interested in joining this supportive community, apply here to get started on your angel investing journey.

Co-Investment: Friend or Foe?

Thinking about co-investing with other investors? It can be a great strategy! Co-investing allows you to share the risk, benefit from the expertise of fellow investors, and strengthen your investor network. But beware of the potential pitfalls, like "groupthink." Make sure to apply your own judgement to avoid being swayed by the crowd.

Networking: Your Secret Weapon

Let's talk networking! Diana stresses the importance of building strong relationships with fellow investors, founders, and industry experts. Networking can lead to valuable new investment opportunities, help evaluate your deals, and learn angel investing from others. By actively participating in such communities, you can enhance your deal flow and improve your investment outcomes.

Learning from Failure

News flash: not every investment will be a success. But that's okay! Diana advises investors to embrace failure as a learning opportunity and use these experiences to refine their investment strategies. Analyzing the reasons for a startup's failure can help you better identify red flags and avoid similar pitfalls in future investments.

Giving Back to the Startup Ecosystem

Last but not least, Diana believes in the power of giving back and supporting founders through mentorship, advice, and connections. By offering guidance and resources, you can contribute to the success of the startups you invest in and help create a thriving entrepreneurial ecosystem.


So, there you have it! Diana Lace Davidova's top tips for angel investing are all about conducting thorough due diligence, spotting high-potential startups, diversifying your portfolio, and learning from both successes and failures. With these insights in your back pocket, you're well on your way to becoming a savvy angel investor.


What is founder-market fit?
How can angel investors reduce risk in their investments?
What are the benefits of co-investing?
How can networking improve investment outcomes?
Why is it important to embrace failure in angel investing?
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