In the corporate world, every entrepreneur has known some filthy rich individuals supporting promising startups. These professionals don’t follow the rules and invest money wherever they like. Yes, I am talking about angel investors. Angel investors are known to provide seed capital when companies need funds in order to get started. Tech giants like Google, Facebook, and Amazon became successful because angel investors were involved in their success. Angel investors are one of the best sources that provide funding for new startup companies. However, there are some facts about angel investors that you should definitely know. These facts are important because they will allow you to experience positive outcomes in the future
Top 10 Facts About Angel Investors
1. Popularity Of Angel Investors
Angel investors have tremendous popularity in countries like the USA, Russia, the UK, and other major countries. In the USA, millions of startups achieved their goals with the assistance of about 800 angel investors. This proves that angel investment cannot be ignored if you want to reach the next level. Moreover, angel investors know the right place and the right time to invest money.
2. Possibility Of Risk From Angel Investors
Angel investors usually do not care when they put their money. They are very confident while making an investment. Due to this reason, tech companies that seemed to have no future became successful when angel investors took the situation in their hands.
3. Qualities They Look For In Entrepreneurs
Owners who possess integrity are the best personalities before the eyes of angel investors for entrepreneurs . Strive to have a solid pitch before approaching angel investors for startup funding. You should never waste their time because they have millions of options to go for.
4. Facts To Tell About Your Business
You should have some answers prepared while going to angel investors. Angel investors can ask questions related to the number of customers, funding amount, prototype, recent achievements, future expectations, and so on.
5. Questions To Ask From Angel Investors
Angel investors are experts that could deliver the best results in a tough economy. However, you can ask questions like the number of startups they funded, interaction with their portfolio, types of startups they prefer, strategy for investment, and potential of their network.
6. Friends And Family Members
Your friends and family members can also act as angel investors to fulfill your startup needs. Angel investors invest in the owner rather than his or her business. People who are close to you already know how much you are capable of.
7. Things That Impress Angel Investors
Here is the list of things that impress angel investors.
- You should be honest while dealing with them.
- You should be aware of the facts about your business.
- You should know the figures related to your business.
- You should be humble while having an interview with them.
- You should have confidence rather than arrogance.
8. When Will You Get Angel Investment?
Angel investment generally takes a long time. This depends on the angel investor you have approached. You should double the time you expected to get the required assistance in the case of angel investors. They will conduct several meetings and interviews before showing some interest.
9. Where Should You Search For Them?
Almost all the angel investors are available on the internet. However, you can find them in your locality as well. Some of them usually prefer offering assistance to businesses that are close to their locality. More often, they could form a group so that potential risks could be minimized and resources are shared.
10. The Funding Amount
Plenty of businesses evolved because angel investors offered a helping hand during the needed time. They can give about $10000 to get started with your business. The seed capital also depends on the capacity of your angel investor. In some cases, they could exceed the traditional amount.
11. Term Sheet Of Angel Investors
The legal agreement between an angel investor and entrepreneur is called a term sheet. The document could contain components such as investment structure (convertible preferred shares, common shares), board structure, agreement from shareholders, and due diligence.
12. Non-Disclosure Agreement
They will never sign NDA. Asking angel investors to sign your NDA makes you look like an idiot. It’s actually hard for angel investors to choose investment opportunities as there are hundreds of deals every day before them.
In this article, we have gone through some facts about angel investors. Entrepreneurs generally need not worry because angel investors are best in their business. They will always choose the best startups to invest in their resources. Sometimes, it can be difficult to find angel investors on the internet. Luckily, you can get angel investors for startup funding in your own locality. However, you should have patience as they could take a long time to supply funds. Also, they will invest in your business if it could give promising results in the coming years.