How to Find Angel Investors That Care
Angel investments are hard to find nowadays as most have either closed shop due to unsustainable losses or are avoiding riskier companies that could bring them financial pain. But what can even be more vexing is finding an angel investor that cares about your company and its future direction, someone who will insist on attending board meetings and is not afraid to get involved in the inner workings of a business.
Determine Your Readiness to Take in Investors
When people give financial tips for young adults aspiring to be entrepreneurs and CEOs, most leap into the task of finding investors that they fail to first question their company’s readiness to take in funding from outside parties. While a vast majority of angel investments will happily give you their business card, it takes a great deal more to actually sign them up for a deal. Ask yourself important questions like “does my business tell a compelling story?” or “do I have the numbers straightened out?”
Look for a Partner, Not a Financial Aid Package
Working with an angel investor is quite similar to a marriage. Partners that complement each other well can yield success in whatever venture they decide to pursue. Those that have conflicting goals and characteristics, on the other hand, tend to tire out in the long run. And since running a company is a long-term commitment, you’d want your investors to also have a long-term stakes in mind. Although cash is important to be able to get your company off the launch pad, a long-term partnership is a much better goal when going out to raise capital.
Assess Your Prospects
Don’t just let angel investors judge your viability as an investable company. You should also be judging them based on their track record. What are their most recent investments? What can they offer companies aside from capital? What are their expectations in terms of corporate management and investment growth? Being on the same page helps the partnership endure even the direst of economic times. Those with short-term profit goals will tend to shake out once your company’s growth begins to slow down or when you encounter obstacles.
Understand Your Investment Choices
Angel investments are only one of the several other investment choices, so it’s not really the end of the line for your company if your prospects face you with a hard “No”. Private equity can also be accessed from private individuals or institutions. The funds can be used to stimulate company growth and facilitate planned projects. Venture capital investments are another type of investment structure you can access. VC funds, however, are usually created to fund startups that have a potential for high and rapid growth. Knowing your investment options in-depth will allow you to negotiate advantageous terms with investors and avoid getting cornered into giving up too much of your company’s equity.
Finding an angel investor who really cares about the success of your company and its mission can be taxing. You’ll need to spend a lot of y our focus and time to ensure that the right candidates are considered. The four guidelines above should help simplify the process of looking for investments outside the workplace.