Are you thinking about an approach to angel investors to see if you can raise some money? Angels are going to be looking at some specific things within your pitch to see if it is a good investment opportunity for them. If you can show that you’ve hit these key points, then you’ve got a pretty good shot at getting an angel investor involved.
1. Proper Administrative Structure
Angels are looking to see if the founder or leadership team in the company has the experience to take the business to the next level. They also want to have people in place who are coachable, yet still be able to make the tough decisions in difficult situations.
2. A Tested Product
Angels are also looking to see if what is being offered by a company has a clear value proposition. They love to see products or services that have already gained some market traction. Customers who have become brand ambassadors because of how much they love the idea being floated are also taken under consideration.
3. The Competition
An idea might be great, but the competition might have several barriers in place that would make market entry difficult. Having intellectual property that is enforceable is a major plus in this area. Businesses that have reduced competition levels and a large potential market share are going to see the best results in this area.
4. The Market
How big the potential market happens to be for an opportunity is also going to weigh heavily on the minds of angel investors. Higher levels of potential sales and a higher market cap will always attract more angels. There will also be a strong look at the overall market penetration that can be achieved in the first year or two of being in business.
5. Financials
Angel investors want to see a company that has a stable cash flow. Even if the cash flow isn’t positive as of yet, there should be a plan to make it positive over time. When combined with an attractive valuation that is justifiable and an ability to meet future milestones within the financial structure, an angel can often see themselves making an investment.
If you can present these key points to angel investors and provide evidence that you’re on pace to meet your milestones, then your idea will be an attractive investment opportunity for angels near you.
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