5 Best ways to find an angel investor for your startup
Whether you’re expanding your small business or are looking into creating a start-up, you may need investors to help fund your endeavor.
Getting funding from angel investors isn’t easy, but it can be done if you take the right approach and are a good match with their interests. And the benefits can beyond the money for your business, but their expertise in both in business operations and your industry niche.
Here are some ways you can find and get access to investors:
1. Angel network
Angel investors often invest through groups or networks. These provide due diligence, extra research, access to potential deals and shared expertise that one person operating alone generally doesn’t have. For instance, one member of an angel group might have background in a particular industry or the know-how to set up deal terms, sharing that knowledge with the other investors.
You can find that angel investor who not only will invest in your start-up, but will also sit on your shoulder, offering mentorship, solid advice, and provide access to their network of contacts.
2. Finding individual angels
Identifying appropriate individual angel investors is much more difficult than finding online platforms or angel groups. One strategy is to conduct an online search. Another strategy is to approach people you know who have connections to angels in your community. Promising targets are lawyers and accountants that do a lot of work with young companies, venture capitalists and angel investors, and directors of accelerators and incubators in your area. All of these people should know the angel investors in your area.
3. Finding an online platform
Beyond LinkedIn, which is still a place to look for investors, numerous professional social networking sites have launched that can help connect you with all types of investors across all industry specializations and business segments. Many of these new professional social networking sites even connect you with investors from other countries who want to participate in the global business environment and often bring your product or service to their part of the world.
Online platforms are websites that provide information on businesses seeking funding. Angel investors use these portals identify businesses in which they would like to invest. Some of these platforms focus exclusively on accredited investors, while others will begin to allow non-accredited investors invest. In addition, some of these platforms are curated, and select only a small fraction of submissions for posting, while others are open and merely make the information about startups seeking financing available to potential investors.
4. Incubators & Accelerators
Working with an incubator or accelerator gives you a whole host of investor resources to watch that business grow up and succeed. These investors are primarily interested in taking on a bigger role to help turn your idea into a viable business model as well as provide the funding sources to make it happen.
These incubators and accelerators even offer a physical space to set up your office, making it easy to work with you directly. Since space within the same building is also being used by other start-ups, this is a great place to exchange ideas and grow together.
5. Private equity firms
Considered a traditional path to investor funding, private equity firms give you access to everything from a few thousand to millions in investment, primarily to those start-ups considered to be in the early stage with great growth potential across a wide range of industries.