If you are still new in the startup business and want to know more about angel investors, well I gathered some foundercafe.io information to get you started :-)
Angel investors are indeed lifesavers for smaller startups. They do that by investing money in exchange for a small percentage of equity. Because of them some businesses are able to have funding to start and grow eventually.
However, you must give the investor a reason WHY they should invest in you. After all why would an investor ever give large amounts of money to someone for no reason at all?
Why do angels invest?
- To make money
- Like the problem that your are trying to solve
- They know the founder
- Connections with other investors
- Learn about a field
The Types of Angels
These investors are categorized based on the money they are able to invest.
- The Broke angels
- Invest only about 5,000 to 10,000
- Syndicates
- able to put around 25,000 to 250,000
- generally the best ones
- Family Offices
- can place 50,000 to 250,000
Assessing their value add
- VC network- angels with LARGE VC networks can make fundraising way easier
- Strategic advice- experienced angels can help accelerating growth
- Distribution- S&M- angels with unfair GTM access can help you get more traction
You should also find what stage they invest in
- Do they want a lead?
- if they want a lead regarding the startup, ask them right away
- Corporate angels vs. startup angels
- corporate angels are risk adverse they demand more revenue
- startup angels are real angels. They only want more vision and innovation within your business.
No, angel investors aren’t angels and it’s not obvious they are “indeed life savers”.
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