The Who, Where And How Of Angel Investors!

Angel investors are the heart and soul of the startup community. It is they who make all the cogs of a startup run….from financial backing to success advice, a good angel investor is  rather  vital for a successful startup.

With a determination to bring a change, entrepreneurs need money to realize the true potential of their ideas. They need financial backing in such trying times, to survive the cut-throat competition. And, this is exactly where Angel Investors come into play.

Who Exactly Is An Angel Investor…

Angel Investors are entrepreneurs themselves, who have experience in the business world. They understand what it’s like to come up with a billion dollar idea…and hence are always looking for budding businesses to help grow.

In times of distress, the investors emerge as the metaphorical “Angel” to support those under their patronage

Usually, Angels are entrepreneurs who invest their own money into ideas that they support. They are well connected business-men, and sometimes even invite their friends to pool their money and invest in your startup.

They are technically the “Daddy” of the startup…giving business advice when needed, deciding how much they are going to invest in your startup, and also taking a share from the startup’s profits…once its starts generating some.

While Angels might give you advice and funds regarding your business… its not their job to grow your business. For that a startup needs the help of venture capitalists..which is a whole different ball game, worthy of another blog!

The Growing Trend Of Angel Investors…

There has been a rising trend in India. The Angel Investment Network, which was absent five years ago has not only grown, but also strengthened. As per a report by  venture debt fund InnoVen Capital. Angel groups in India has grown significantly in 2016, amounting to Rs 113.7 crores across 69 deals, as compared to Rs 70.3 crores across 47 companies in 2015.

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The numbers indicate towards a startup ready nation. With big money men in even Two Tier cities now trying to get a little startup action, angel investments have been increasing in all parts of Urban India.

How To Get Angel Investors…

Now when you search it on the Internet, you will find a lot of business men, having an intimidating portfolio of startups under their aegis. Sunil Kalra, Rajan Anandan, Sanjay Mehta….there are a lot of of such business men who actively invest in startups.

The major question is how to get an angel investor??

Our expectations out of angel investors is this;

 

But that is not the case. Coming in contact with them is easy. Just open up the internet…do your research and viola…you have your List Of Angels.  Another way is to contact them on Indian Angel Network, the social network to get investors.

What is important after approaching the investor is the pitch. How you sell your business to the investors. Because if anyone is giving you money, they will make sure that the investment pays them off too.

Every part of your business would be scrutinized…form your business model to your clarity of business concepts. A lot of people fail at this stage.

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Prepare well, know your business inside out and work on your pitch. and BOOM…You Impress the Investor!

Keep The Investor Happy…

Being a keen observer of the startup culture in India, I have noticed something amongst the business owners these days… They are unable to deliver to their angels. Now its very important for a startup to keep the angels informed about the current developments your business.

A monthly or bi-monthly report easily satisfies the angel. remember, he is putting in his personal finances into your business. As a business owner, its your responsibility to keep communicating how the business is going.

Other than that, the angels are people with connections. If you tell them what you require, their years of network building can help out your venture. they can get you required access to technology, press, customers..and more.

Another instance when startup founders cut communication with the investors is when the business isn’t doing well. The advantage of having an angel rather that a VCs during your startup’s initial years is the personal touch an angel adds to your business. The startup I worked for this summer, my boss was constantly updating the investors about the losses or crisis in deliveries and what not. They are there to Problem Solve.

So be connected…be consistent with your effort… measure your business’s growth…and present it before the investors before the deadline. That is the secret to a satisfied Angel Investor.

Of course, profits also makes them happy…try that with your startup!!!

 

 

 

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