6 Strategies When Searching For Angel Funding
With venture capital becoming more and more of a bygone dream for early-stage companies, many startups want to turn to angel funding to raise capital but don’t know where to start.
What to think about before raising capital:
1) What types of investors will I approach, how much will I ask for, for what to spend on and what milestones do they care about.
2) VCs are paid money managers. They get paid to manage investments. Angels invest out of our kids college funds. . . That inherently means that angels and founders are perfectly aligned in today’s investment world.
3) Just getting money is not the actual objective. Get smart money “from the people that will help you spend the money wisely.
4) The difference between dumb money and smart money is showing up much more than before. Investor alignment is a really big deal. Avoid a deal where you don’t know the other investors… You’ve got to have alignment on the board and in the investor pool.
5) The amount of money you should raise is the smallest amount of money that can have the biggest impact on your valuation in the shortest period of time.
6) Don’t you take your business plan to (the potential investors), get someone who knows them to take the business plan to them. Your problem is not getting to angel investors; it’s getting to the top of the pile. . . . Getting into the pile is not a success.
Want To Learn More?
Download our free Raising Capital from Angel Investors eBook.
This guide will walk you through the process of obtaining seed capital for your startup. This book includes:
- An overview of the angel investor process and who they are
- The milestones angel investors look for when evaluating your business
- Strategies for finding the angels best fit for your startup
- How to nurture the relationship, prepare for the meeting and deliver the pitch
- Rounding out the details and preparing for the future