Sailing With Angels: 05 Do’s and Don’ts for Startups While Looking for Angel Investment

By Ankit Sharma, Founder and Director of Smartup Solutions Pvt Ltd

Angel investing is a critical source of capital for startups. The angel investors provide funding to promising ventures in exchange for equity. Angel investors can play a vital role in helping startups validate their ideas, develop their products, and build their teams.

However, connecting with angel investors requires a lot more than a perfect pitch deck. Running a startup is like running a ship, you need a lot of knowledge and skill to maneuver the ship successfully.

Below are several Do’s and Don’ts for startup founders steer their ship towards securing an angel investor.

The Do’s:

1. Embark on a Quest of Knowledge:

Before you set sail, you need to chart your course. Research potential investors with the keen eye of a treasure hunter. Seek out those who have a history of investing in ventures akin to yours. Knowing their preferences will help you craft a pitch that sings their song.

2. Forge Bonds Like a Master Craftsman:

Networking is your ship’s compass. Attend industry galas, startup soirees, and gatherings where investors roam. Forge connections that aren’t just transactional, but resonate on a human level. Building trust is your secret weapon.

3. Craft a Saga, Not Just a Pitch:

Your pitch should be an epic tale, one that enraptured the audience. Unveil the problem your startup resolves, your unique tale of triumph, the boundless market that awaits, and the valiant team behind it all. Keep it lively, focused, and captivating.

4. Show ‘Em Some Tracks:

Angel investors are like explorers – they want to see tracks in the wilderness. A working prototype, a tribe of early adopters, or promising market research are like breadcrumbs leading to your startup’s potential.

5. Let Your Business Bloom and Blossom:

Investors yearn for a venture that can stretch its wings and soar. Be ready to illustrate how your business can grow and scale, transforming from a sprout to a mighty oak.

6. Honor Truth and Transparency:

In this journey, truth is your loyal first mate. Be candid about the storms you may face, the dragons on the horizon, and the risks that lie in wait. Honesty is your north star, guiding you through the entrepreneurial sea.

The Don’ts:

1. Aimless Arrow Shots:

Sending generic messages in bottles won’t cut it. Personalize your outreach, show them you’ve studied their treasure maps, and let them know why your adventure aligns with their quests.

2. Skipping the X Marks the Spot:

Don’t just let the investors scrutinize you. Turn the looking glass around. Investigate potential investors – what lands have they conquered? What legends precede them? Make sure your visions align.

3. Inflating the Pirate’s Bounty:

Confidence is key, but don’t let your treasure chest be filled with fool’s gold. An overly inflated valuation can make even the most daring investors turn tail.

4. Deaf Ears to Wise Counsel:

When seasoned sailors share their wisdom, pay heed. Even if they don’t join your crew, their insights are pearls of wisdom that can refine your ship’s course.

5. The Invisible Map of Funds:

Investors want to know where their doubloons are going. Provide a detailed treasure map – show them how each piece of gold will contribute to your journey’s milestones.

6. Building on Shaky Ground:

Ensure your startup has a solid foundation. A ship with creaky boards won’t withstand a tempest. Ensure your legal and financial rigging is seaworthy.

Connecting with angel investors is like navigating uncharted waters. It requires not just a compass, but also a heart full of passion and apnapan. By following these do’s and avoiding the don’ts, you’ll not only secure the funding you need, but also find partners who share your vision and can guide you through the tempests of entrepreneurship.