Angel Investing

On Thursday afternoon, President Obama signed the JOBS Act, and among the changes it will bring to the world of business startups is one that makes use of a rising trend: The power of crowdsourcing.

Web startups are now so cheap to build out and can fail so quickly that very early stage funding, when angel investors tend to participate, has risen in prominence. Venture capital, which usually enters at a later stage, is playing a shrinking role.

The global economy is awash in venture capital seeking the next big thing. But if America is to create start-ups again like it did in the 1990s, Harvard Business School professor William Sahlman thinks two specific things need to happen.

A lot more money could be flowing to promising startups. But it's not because some investors are disgruntled about VC's high risk, low returns, and scarcity of ways to cash out. And in the absence of a new wave of big tech innovation, investors have little incentive to part with their cash.

The purchase of investment blog Abnormal Returns by Twitter-like Stocktwits may signal a new trend in online finance: It's called the real-time Web. Investors can get an instant snapshot of the sentiment of other investing pros by joining an immediate and constant online conversion.

It didn't even take a full weekend for the former head of Google's (NASDAQ: GOOG) China operation, Kai-fu Lee to find a new home. The recently departed executive announced on Sunday that he was planning to start his own business in the coming week, funding technology startups in China. So, he'll be...