Over the weekend there has been some controversy surrounding AngelList, the network that connects startup entrepreneurs and investors. Before AngelList, investment dealflow was private and networks revolved around a few connected angels and VC?s. Since the angel network was created, transparent angel investing has exploded and entrepreneurs from any background can get funded.

To my surprise, VC? Bryce Roberts, a partner at O?Reilly Tech Ventures, was so concerned about the network that he deleted his AngelList account. In his post, Roberts says he was not turned off by the quality of startups, but by the investment philosophy pushed by the service. The predominate philosophy pushed by the service, he said, favors a light-touch investment style similar to throwing darts on a board, as opposed to a more concentrated approach.

Chris McCann is the co-founder of StartupDigest, the members-only guide to the tech startup world. Every week StartupDigest publishes weekly newsletters about the best events, jobs, and what to read for your industry. Follow McCann on Twitter @Mccannatron.

Roberts also takes issue with the emphasis on ?social proof? on AngelList. Since most companies have little to no revenue, who else has already invested in the deal is heavily weighted to prove value. This, he argues, leads to a herd mentality.

Other VC?s and Angels such as Jason Calacanis and Dave McClure responded to Roberts and took the opposite stance - McClure and his fund 500startups have done 20-plus deals directly from AngelList and they greatly prefer the ?spray-and-pray? approach vs. the concentrated approach.

There's now a heated discussion in the investor class about AngelList. Based on my experience as the co-founder of StartupDigest, I believe that the startup investing industry is quickly being organized more like the public investing market, and what we are seeing now is a battle of two major investment theses: the index approach and the concentrated investment approach.

Index vs. Concentrated Investing

In the traditional stock market an index is a small sample of the market that represents the stock market as a whole. The reasoning behind investing in an index fund is that it closely matches the overall market - and it'?s very hard to beat the efficient market. The most popular traditional indexes are the Dow Jones Industrial Average, the Standards and Poor?s 500, and the Nasdaq composite Index.

The opposite approach of index investing is an actively managed or concentrated investing approach. In this approach, you take your competitive advantage (your market-specific knowledge) and invest heavily in a few companies you know well. Two famous investors who take this approach are Warren Buffet and Benjamin Graham.

In Roberts' account of why he deleted his AngelList account, it?s clear that he favors the concentrated approach to startup investing. Roberts would rather not invested on ?social proof? alone and would rather take time to find companies that he can actively manage and leverage his competitive advantage with.

McClure's rebuttal to Roberts is that the index philosophy is not only easier but better than the concentrated investment approach. Instead of investors holding onto proprietary connections and introductions for their portfolio companies, these relationships are being displaced by the dominate social networks (Facebook, Linkedin, Quora). Dave argues that instead of providing connections you should let founders do 95% of the work and offer support with operational areas of expertise like design, data and distribution.

Think of individuals like McClure, Paul Graham and George Zachary as market analysts. These new super angels are really signals in that marketplace that are causing others to invest or not invest.

How This is Changing the Startup Investment World

No matter what investment philosophy ultimately proves to outperform the other, the startup investment world is changing rapidly.

Services like AngelList are making the startup investment world more organized and efficient than ever. Quickly, startup investing is looking more like the public markets, and power is quickly shifting to the entrepreneur from the investors.

AngelList is operating very much like the NASDAQ stock exchange of the startup investment world, where deals and angel investors are public. Just look at AngelList?'s new markets feature, where you can break out specific investors and deals by sub-markets. I don't think it will take very long for investors to be able to invest in whole markets and entrepreneurs to pitch a whole group of investors in a certain market.

Think of individuals like McClure, Paul Graham and George Zachary as market analysts. These new super angels are really signals in that marketplace that are causing others to invest or not invest based on their due diligence and research.

The big shift is not entrepreneurs getting to choose whether they want money to grow their business, specific functional expertise from their investors, or a combination of both. More and more power is shifting away from the investors to the entrepreneurs and this trend does not look to be slowing down.