What to consider when approaching an Angel Investor

30 August 2018

What to consider when approaching an angel investor

Angel investment is typically one of the earliest equity investments made into a start-up business. Angel investors are almost always wealthy individuals that tend to band together in networks, like Anglia Capital Group in order to share knowledge expertise and risk. 

Angel Investors are often seen by entrepreneurs as the ‘friendlier’ source of finance. And indeed, they are often more accommodating than VCs, banks, and other finance providers. This is because that they are willing to take a higher risk by investing at an earlier stage. Why? Because they are aware that high-risk = high potential return and so they are looking for the next Google/ Facebook/ Uber. 

Angel Investors are not stupid. They tend to be fully aware of the huge number of start-up businesses that fail. For this reason, you should never expect that raising angel investment will be easy. If they are going to invest in this form, they are going to make sure that they are as certain as they can be about you and your business proposition. 

90% of business angels ay that PEOPLE are the deal breaker. So, don’t assume that you are the first person to sit in front of a business angel with a great idea. Typically, angels are approached on a daily basis with investment opportunities, but they want to know whether YOU can make it work.

This may seem shocking, but here are some of the top quoted reasons for an angel to be put-off a deal:

  • Incomplete Information and avoidance of the truth
  • Unrealistic expectations
  • Arrogance
  • Keeping the investor waiting
  • Silly Mistakes in the Business Plan
  • Pre-occupation with the product or technology

If you would like to learn more or have a business opportunity that you would like to present to angel investors, contact info@angliacapitalgroup.co.uk 

Hannah Smith