Finding an Angel investor can be daunting and whether it’s a face to face meeting or an online presentation, you need to be as professional and well prepared as possible.
Here are a few guidelines to assist you in this process.
Is there a typical Angel Investor and how do you recognise them?
Angels are successful business people who most likely have had considerable exposure to early stage companies from both the entrepreneur and investor vantage points. They are attracted to the challenge of start up companies that offer promising growth opportunity and in which they can contribute their experience and knowledge. Angel Investors could be family, friends, colleagues, business associates and so on.
They all share one common element and that is the desire to invest in new ventures.
Target Angels in your industry first
Angel Investors typically prefer to invest in industries in which they have have expertise in. This allows them to contribute beyond just capital. While this represents your best opportunity for funding, Angels have been known to invest in opportunities outside their knowledge base. When you find an investor, do some research to determine what their interests are and how you should approach them.
Know the preferred investment range
It’s also important to know that most Angel Investors have a preferred investment range which is typically anywhere from £50,000 and upwards of £500,000. Why is this important? It saves you from not wasting time when the amount you require is either above or below the investor’s comfort zone.
Begin your search close to home
Angels for the most part are very territorial and prefer to invest close to home.
The rule of thumb is to stay within a 50 km or 100 km radius. Investors are not only investing in a concept or a business, they are also investing in its people. Most investors have an interest in knowing who the principals of the company are and prefer to meet face to face. Another compelling reason is that many Angel Investors like to play an active role in the business they invest in, so the closer they are to the business the better.
And – go where they go!
Active or serious Angel Investors interested in finding good companies, will attend most events where they believe good companies will be. Go where they go. You should make efforts to attend local business networking events, especially those featuring company presentations and technologies. These types of events are of particular interest to Investors. Chamber events and industry trade shows, Technology shows and Venture capital events that highlight specific Angel Investor sessions are always a good idea. Make it a habit of attending these events and you may find investment or establish contacts.
Always be networking
Individual investors are hard to find and to be successful you need to do a lot of networking. Make it a habit of getting your name and face out there and meet as many business people as you can. Many business owners have experienced the same challenges you are facing and may want to help. Consider all of them potential investors and even if they aren’t they may know one. Getting the word out in your community and business network maximises your chance of getting an investor referral.
Continue to get the word out and get referred
In most cases, you need to be referred to an Angel Investor. Approach the people you know, friends, associates, business contacts who may be able to refer you to an angel investor.
Don’t forget the internet
Research web services that provide entrepreneur and investor matching. Subscribing to this type of search method gets your business proposal sent to a wider audience. It’s extremely important that your proposal hits on all the triggers that investors look for and sites like this one, will ensure that your investment proposal is properly categorised in the right format, region, investment amount and industry.
Look for Angel Investment groups
There may be active group of investors in your community. While there are Angel Investors who invest entirely on their own, many will also associate with an investment group where they can spread the risk and share the resources.
Approach people in an Industry trade show
If you are thinking that you will find an investor at Industry trade shows and this is part of your investment proposal strategy. Also consider the below.
Send out an Email campaign
If you think you will find an investor by email then this is a cost-effective method of reaching a large audience quickly.
Social & business networking
This is an excellent way to meet a potential investor. Continuously getting out there and doing more social and business networking can only help you in your efforts to find and attract a potential investor.
Targeting Organised Angel Group
This is another excellent way to meet a potential investors and you can usually find organised groups close to where you do business.
Using online angel investment networks
Registering with online angel investment network services is an excellent way to meet a potential investor and it has become extremely popular over the last few years.