Thursday, May 19, 2011

Pitching to Angel Investors – What’s Important?

If you are interested in getting funding from an angel investor, chances are you have at least one or two people in mind already.  The trouble is, while it’s easy to understand what you will need to pitch to a VC or bank, it’s not always so simple to be sure of what angel investors are looking for in your business plan or pitch.

Since, as the saying goes, forewarned is fore armed, we have decided to look at what private angel investors look for, so you can pitch accordingly.

Your Niche

Often, angel investors are successful entrepreneurs, who have made their fortunes in a particular niche.  It is not always strictly necessary that your business idea is in the same niche, it can help your case when pitching!

Before you pitch to an angel investor, it is a good idea to do some research, and find out which industries they were or are involved in, and what fields they are interested in.  If your potential business is one that is complementary to their existing businesses or companies, you may just find that you have an easier time pitching your ideas.


There is a saying in the field of venture capital – that investors aren’t lending money to an idea, but to a person.  That’s even more true when you’re pitching to angel investors.

When you pitch to an angel investor, you will often have a one on one meeting, rather than a meeting with a board or group of people.  Your enthusiasm for your business or idea will be even more obvious in that sort of setting, and it will be very easy for the business angel you’re approaching to tell whether or not you’re in love with your idea!

Make sure your energy, excitement and passion for your idea shines through – it might even be more important than facts or figures!

A Solid History

Another thing your potential angel funder will want to see is that you have a solid history – either in your field, or in business. Take some time to think about your CV, and what you’ve already achieved, as well as how that relates to the business you’re interested in.

Make sure that you don’t embellish your achievements though – it’s better to admit that you don’t have much experience if you don’t, than to try to lie about it. Remember that your relationship with an angel investor is largely based on trust, so start of on the right foot!

A Sound Business Plan

Doing research on the business angel you’re approaching themselves, and ensuring that your passion for your project shines through is vitally important when approaching an angel investor, but it’s just as important to make sure that you have a business plan.

Angel investors are often more involved in the substance of the plan than the layout or format, but they’ll almost always want to see basic information about your business idea, how you plan to achieve your goals, and the financials that are involved.

Make sure that you arrive to any meeting with a potential investor with a comprehensive business plan, but try to keep it short and sweet. Your business angel can always ask for more information if he or she is interested, but you don’t want to bore them with too much information at first!

Angel funding may not be easy to find, but the good news is that it’s often easier to obtain than many formal types of funding, particularly if you are a first time entrepreneur! Just remember that an angel investor is lending money to you, as much as they are lending money to your idea, and pitch accordingly. 

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