Funding your business so that it can become more than just a dream is no easy task. With that in mind, you may be thinking about how to find angel investors who can provide you with the kind of capital that will allow you to secure funding and grow your company.
There are a number of methods by which you can find an angel investor; a person who provides you with capital in exchange for partial ownership of the company.
Because funding your business is such an involved and important process, you want to make sure you do it right and find an investor who will be a perfect fit for your business.
So let’s take a look at some of the things that you should consider when trying to answer the question of to how find angel investors. You will be able to use the information to guide you in your own search for that perfect financial backer.
Informal Investors: What to Look For
When it comes to trying to find someone to invest money in your business, there are several things that you want to keep an eye out for.
These are some of the criteria that will tell you whether or not an investor is right for your entrepreneurial needs.
- The angel investor has experience – This is probably the most important quality to look for when you need to find an angel investor.
You will want to look for someone who has years of experience in venture capital, because such an individual will be a valuable asset to the growth of your business if they decide to invest in it.
- The angel investor is familiar with your industry – You should be familiar with every single aspect of the product or service that you sell, and a potential angel investor should know everything there is to know about the industry in which you work.
By seeking out someone who has familiarity with your industry, and not just a person who has the money to invest, you can ensure that his or her decision to invest will be a fully-informed one.
- The angel investor takes a “hands-on” approach – This ties into experience and familiarity, but when trying to answer the question of how to find angel investors, you want to look for investors who will take an active interest in how the company is run.
They will, of course, be entitled to some of the decision making as long as their financial stake in the company stands. An angel investor who shows interest in your operations and isn’t in it for just the money will likely stick around longer and do what they can to help you where they can.
Their money is at risk too, after all.
These basic criteria for what to look for in an angel investor are all places to start when trying to find someone with whom you and your business will be compatible. Now that you know what to look for, where should you look to try and find these people?
Take a look at the next section to find out.
Informal Investors: Where to Look
The question of how to find angel investors should very much involve where you need to look as it does what you need to look for.
With that in mind, let’s look at many of the regular places that entrepreneurs like you have looked in the past and you will get a clear idea of just where to begin your own search.
- Your business associates – Running a successful company relies in part on keeping the people who helped you get to where you are close. This entails maintaining strong bank relations, as well as business-to-business relationships that can help you when you need them.
Consult people with whom you are close when trying to figure out how to find angel investors to provide you with start-up capital. You never know who might turn up.
- Professional organizations – If you aren’t a member of any professional organizations or trade groups that are relevant to your industry, then you may want to seriously consider joining some.
These groups will allow you to network with like-minded individuals who might either be angel investors or will be able to point you in the direction of people who specialize in venture capital for companies in your industry.
- Internet connection services – You aren’t the only entrepreneur who has asked the question of how to find angel investors, and that’s why the Internet contains a wealth of resources concerning where to find angel investors.
When searching online, it helps to try to stay within your general region, as you want an angel investor to be someone who can provide you with business coaching and meet with you on a fairly regular basis.
Remember, running a business successfully does not need to be complicated. Keep it simple!
Manny Skevofilax is a consultant and speaker that helps his clients successfully navigate the challenges of growing their businesses profitably. Since 2003, Manny helps businesses enhance their results by using his experience in strategic planning, financial statement analysis, operations, organizational development, and team-building. His consulting firm, PORTAL CFO Consulting, Inc., has attracted clients from diverse industries in the United States and abroad.
Manny can be reached at 410-808-3441 or via email at firstname.lastname@example.org.