When you think about, the term 'angel' investor is a pretty fitting title. After all, they're one of the only lifelines start-ups have to get off the ground and go from 'just an idea' to reality. As legitimate as angel funding has become in comparison to venture capital, it's still widely considered unchartered territory.
Finding, meeting, and talking the talk with investors can be tough enough, but when you factor in how this person fits with your current model (as well as how it will grow), it's no wonder so many startups struggle with getting past their seed round.
In yet, despite how daunting it may seem to find the right angel, it's probably one of the most vital processes to the success of your business. This person isn't just going to play the role of advisor or mentor; they're going to be just as much of a team member as you are.
And whether you're just raising seed or about to enter your Series C, today we're going to over some tips on landing an angel that can levitate your startup to the next level.
Have a crystal clear understanding of what you're doing.
When I first started fundraising, I was as giddy as a kid in a candy store to talk about my ideas. "I'm going to change the world!" I thought, not realizing that changing the world first requires explaining how and why it should be changed.
So many of my initial conversations with investors ended up being muddled into radio silence partly because I didn't understand what they were after. Sure, I knew what my product did and how it worked, but I couldn't explain it in seven words or less while simultaneously making people excited.
The feeling you want to capture follows the classic adage of "don't just give them what they want, but what they want and didn't know they could have." This doesn't necessarily mean you should go out and spend a ton on branding or identity, but that's not to say presentation isn't crucial to conveying what your company is about.
Investors want to see that you take the aspects of selling your product seriously. After all, they're investing in not just your startup, but everywhere it goes as well.
Look into the communities you're already a part of
Over the years I've been a part of startups that range from products for the Crossfit community to SEO analytics. No matter what type of company I've been in, the first thing I always do in fundraising is target those I feel would be great to work with, but also would understand my product.
Start out by jotting down a short list of those you admire and respect in your industry. Even if they aren't what you'd consider a traditional investor, still put them down. Believe it or not, I've found that sometimes those can be your greatest advisors as their knowledge-base and experience varies greatly from yours.
While some investors may not contribute as much financially, they could be the perfect fit in being a mentor or lending celebrity appeal. No one is too big or small to potentially bring on, so don't hesitate to reach for the stars (no pun intended).
Bring on people who understand how you, your team, and vision work together
When I first started fundraising again after my release from prison, I knew one thing was clear: I was never going to beg for capital from those that were hesitant about giving me a second chance. I just knew it wasn't worth the headache considering they'd always have us under an intense amount of scrutiny, as well as aren't philosophically on the same level.
This same principle went for my team: if they didn't understand our workflow or process, then they were probably hurting us more than they were helping. The best approach to this is imagine them hanging out at the office for a day. Would they sit back, observe and ask questions or come in and start micro-managing?
Finally, standing firm on what your overarching vision is the most vital key to your success. It may sound silly, but I've turned down investors that I felt were more interested in my product or idea than my team and me.
Make no mistake; this can be one of the worst positions for a founder to be in. After all, here's your lifeline slowly but surely trying to rip your company away from you. Even if they're brilliant, develop a level of trust in that your visions align as well as what you can learn from one another. Do this, and you can collaborate on changing the industry forever.