Did you know that startups as successful as WhatsApp and Uber initially started out by using funds from angel investors? Growth hacking experts understand that capital is usually one of the biggest challenges for startups. Though they may have the passion and the right product, if they don’t have the funds to hire, market, and pay the bills, they may not succeed. Fortunately, there are a number of funding options available to bolster startup business resources. In this edition of our Startup 101 series, we’ll talk about one that is getting a lot of buzz in the startup world these days: angel investors.
An angel investor is an individual (or group of individuals) that is/are committed to helping startup businesses through private financial support. In exchange, they typically gain a small stake in the company or agree to a profit-sharing arrangement. Angel investors tend to focus more on their belief in the person or people behind the startup than the potential for incredible near-term profits, and often play a bigger role in the companies than their venture capitalist counterparts.
So how do you find angel investors who might take an interest in your company and help you grow your startup? Here are three ways to get started.
Do Your Research
If your startup’s product is a meditation and relaxation app, you may make a mistake by approaching an angel investor who has historically backed video gaming technology. However, you might find success by researching those who have helped fund similar apps like Simple Habit and Headspace. Consider reaching out to the founders of startups that are similar to yours, and see if they are open to being a mentor, advisor, or even a board member. They might share startup tips that worked for them and help point you in the right direction when it comes to securing an investor.
Attending angel investor events can be a great way to meet potential business partners, gain experience pitching your business, and make valuable connections that can help with your startup development. Popular events include the 2017 ACA Summit, monthly Startup Grind events, and University Startups Conference & Demo Day. In fact, Promeets is hosting an event with author and superangel investor, Matthew Le Merle, on October 5, 2017 in San Francisco that you may consider, as well. Before you invest a lot of time and money attending events, make sure you choose ones that fit your market and will have investors in attendance that have demonstrated interests in products or services similar to yours.
Work with a Connector
It can often be difficult to find an angel investor on your own. By nature, some angel investors like to stay under the radar and tend to shy away from the spotlight. For this reason, it can be quite valuable to work with new business experts that can serve as a connector to investors who may be a fit for your startup. Promeets, for example, has forged a partnership with the with Bay Angels, the pre-eminent network of local, Bay Area angel investors, to foster relationships between aspiring entrepreneurs and active early-stage investors. In addition, we routinely bring Bay Angels experts onto our platform and offer startups the chance to pitch their business plans to them.
We are pleased to provide the following services exclusively to active Promeets users*:
- Receive a warm intro to Bay Angels
- Submit your pitch documents to Bay Angels
- Submit a 3-4 sentence overview of your startup that will be included in a monthly newsletter to Bay Angels and other funding partners
Angel investing can be a beneficial resource for startups that need an injection of capital to properly get their business off the ground. If you’d like more information from our startup experts on how to find an investor, or would like more growth hacking tips, please reach out to one of our experts.