Brian Nichols is the co-founder of Angel Squad, a community where you’ll learn how to angel invest and get a chance to invest as little as $1k into Hustle Fund's top performing early-stage startups

Becoming an angel investor isn't a single decision but a series of steps that build capability and position. Rushing through early steps creates problems later. Taking too long on any step delays progress unnecessarily. This progression balances thorough preparation with practical action.

These are the ten steps to become an angel investor, based on the path that actually works.

Step 1: Verify Your Qualifications

Before investing time in learning, confirm you meet the basic requirements for participation.

Check accreditation status honestly. Do you clearly meet the $200,000 income threshold (or $300,000 joint) sustained over two years? Or the $1,000,000 net worth threshold excluding primary residence? If the answer is ambiguous, you might not qualify yet.

Assess your capital realistically. Beyond accreditation, do you have $15,000-25,000 of genuine surplus that you can lock up for a decade without affecting your life? If not, building this cushion might be prerequisite to angel investing.

Evaluate your time availability. Can you sustain 3-5 hours weekly for years? If your life is already overcommitted, angel investing might need to wait until circumstances change.

This verification step prevents wasted effort on a path you can't currently pursue. If qualifications aren't met, focus on reaching them before proceeding.

Step 2: Build Foundation Knowledge

With qualifications confirmed, invest time in understanding how angel investing works before deploying any capital.

Study portfolio construction deeply. Understand why diversification matters, how power law returns work, and why 20+ investments represents minimum viable portfolio. This foundation shapes every subsequent decision.

Learn investment structures thoroughly. Understand SAFEs, valuation caps, and dilution mechanics well enough to evaluate terms intelligently. You don't need law degree, but you need basic literacy.

Develop evaluation frameworks. Learn approaches to assessing teams, markets, and business models. You'll refine these through practice, but start with structured frameworks rather than pure intuition.

This foundation building typically takes 4-6 weeks of dedicated learning.

As Elizabeth Yin, co-founder and GP of Hustle Fund, explains: "Most of your investments will return $0. You will lose money. So it's important to have great portfolio construction."

Foundation knowledge prevents the costly errors that uninformed beginners make.

Step 3: Research and Select Community

With foundation knowledge built, choose the community that will provide your deal flow, ongoing education, and peer support.

Evaluate deal sourcing quality. Where does the community source opportunities? Is there institutional backing? Angel Squad's access to Hustle Fund's pipeline of 1,000+ monthly applications represents institutional-quality sourcing.

Assess educational programming. Who teaches and what's their current activity? Weekly programming from active GPs provides more relevant education than sporadic content from inactive investors.

Consider peer community composition. How distributed and engaged are members? Angel Squad's 2,000+ members across 50+ countries indicates genuine global community.

This research typically takes 1-2 weeks before making a selection decision.

Step 4: Join Your Selected Community

With community selected, take action by completing membership.

Complete application and verification. Provide accreditation documentation and complete whatever onboarding the community requires.

Pay membership fee. Angel Squad's $3,500 lifetime membership provides ongoing access to deal flow, education, and community.

Finish onboarding content. Most communities have introductory materials that help you understand how to engage effectively. Complete these before diving into deal flow.

Step 5: Enter Observation Period

Before investing, spend time observing how the community functions and practicing evaluation without capital at risk.

Review every opportunity presented. See what deal flow looks like. Understand the range of companies and stages represented. Get comfortable with the format and information provided.

Practice applying evaluation frameworks. For each opportunity, work through your assessment. What's your read on the team? The market? The terms? Document your thinking.

Attend educational programming. Engage with the learning opportunities. Ask questions. Understand how experienced investors think about evaluation.

This observation period typically lasts 6-8 weeks.

As Eric Bahn, co-founder and GP of Hustle Fund, emphasizes: "For beginners, a bigger startup portfolio is better. It helps with diversification and helps you learn and get reps in. Investing requires practice like everything else."

Observation is preparation for the reps that matter.

Step 6: Make First Investment

With observation complete, take action on an opportunity that meets your criteria.

Select opportunity that fits your framework. Don't wait for perfect certainty. When an opportunity meets your basic criteria, proceed.

Complete the investment process. Indicate commitment, sign documentation, transfer funds. Experience the actual mechanics of investing.

Document your thesis. Write down why you invested. What excited you? What were the risks you accepted? This documentation creates feedback loop for learning.

Step 7: Establish Investment Rhythm

After first investment, build consistent practice rather than sporadic activity.

Target quarterly investments. Aim for 6-8 investments per year, roughly 1-2 per quarter. This pace builds portfolio while maintaining sustainable engagement.

Maintain consistent check sizes. Keep every investment at $1,000 regardless of conviction. Discipline produces better outcomes than excitement-based variation.

Stay engaged between investments. Continue attending programming, reviewing opportunities, and participating in community even when not actively investing.

Step 8: Build Full Portfolio

Over 2-3 years, construct the diversified portfolio that proper angel investing requires.

Reach 20+ investments. Continue quarterly rhythm until you've built adequately diversified portfolio. This typically takes 2-3 years.

Maintain sector and stage diversification. Don't concentrate in whatever sector is currently hot. Spread investments across areas and stages.

Track everything systematically. Maintain detailed records of investments, theses, and outcomes for learning and management purposes.

Step 9: Transition to Portfolio Management

With portfolio constructed, shift from active building to ongoing management.

Read every company update. Stay informed about portfolio developments. Understand how companies are progressing.

Maintain community engagement. Continue learning and participating even when not actively adding investments. The education and relationships remain valuable.

Evaluate opportunities for follow-on if appropriate. Some portfolios include follow-on investment opportunities that warrant consideration.

As Shiyan Koh, co-founder and GP of Hustle Fund, notes: "Great founders can look like anyone and come from anywhere."

Portfolio management includes supporting diverse founders across your investments.

Step 10: Practice Patience for Outcomes

With portfolio built and managed, the final step is patience through the years until outcomes materialize.

Maintain realistic timeline expectations. Seven to ten years means seven to ten years. Don't judge portfolio performance prematurely.

Avoid reactive decisions. Market fluctuations, individual company struggles, and temporary setbacks don't require portfolio changes. Stay the course.

Continue learning and developing. Even during the waiting period, your capabilities can grow through ongoing engagement and education.

These ten steps represent the path from aspiration to active angel investing. Angel Squad supports every step: verification of qualifications, foundation learning through educational content, community membership with institutional deal flow, observation period with real opportunities, first investment at $1,000 minimum, and ongoing engagement through weekly programming and peer community. The path is clear. The question is whether you'll walk it.