If you are in the business industry then you must have already heard about angel investors. They have already gained popularity and momentum over the past years and known to be individuals that could help you and your business succeed. But, first we should understand what these investors are and finally learn how to get an angel investor.
Understanding What an Angel Investor Is.
An angel investor (also known as Business Angel and Informal Investor) is an individual or a company that could provide capital and willing to invest in private firms that are currently on the early stages of business development. Usually this is in exchange for ownership equity or convertible debt. However these investors look for companies that shows potential high growth, success and synergy to the business they will be involving with.
For people who are just starting their business it is essential to find investors such as angel investors to offer them with a start-up loan to jump start their business. This is one of the best ways to acquire the necessary capital to ensure the development and to strengthen the business immediately. However, having this venture requires the business owner to be willing to accept outsiders into your company and provide them with a variety of control towards your business. Therefore, it is important for the business owner to provide the angel investor with a way of exit. This could be in the form of public offering or a buyout from another larger firm. Providing these exits could easily attract many angel investor to get involved into your business.
As a starting company you need to be conscious that there are various angel investors to invest into your company. However, this venture could be costly and may require a lot of negotiations for you to have them as investors for your firm. It will commonly require many different terms into their investments.
Finding these angel investors could surely be a hard task especially if you don’t have an idea of where to find them. Nevertheless, once you have successfully discovered where to find them, all the hard work and efforts are sure to be worth it.
How to Get an Angel Investor?
First Step: Know where to find an Angel Investor. Here are few places where you can find your investor.
Start Looking for Angel Investors That are Near Your Home or Business: Investors can be anywhere and can be close to your location. Having them near to you enables you to have an easy access and communication with your investor.
Try Asking Your Family and Friends: Investors can also be those people that are close to you such as your family or friends. Often times these people are the ones willing to invest financial into your business knowing that they could trust due to the fact that you know each other for a long period of time.
Look for an Investor in Universities with Programs for Business: There are high levels of business opportunity in business schools. Therefore, it is not surprising to find your angel investor here. You could also make contact with the people running the business and entrepreneur program of the university for they could point you to a prospective investor.
Contact Associations of Business Incubators: Business incubators are programs created to accelerate the development success of entrepreneurial companies. They also offer access to angel investors to companies that might need them.
Contact Clubs and Confederations: Angel investors can also be found in many associations that are in search for business deals accessible for them.
Second Step: Take Action.
Contact Chamber of Commerce: Ask them if there are any venture capital groups hosted near your business location.
Consult a Professional: Ask your lawyer, accountant or any professional for any information on where to find people that are handling entrepreneurial investors and services that you need.
Communicate with the State or Regional Economic Development Agency: The can provide you with access to information on angel investor associations.
Impress Your Potential Investor: A well created business plan is a must. Provide them with a company prototype, if possible. This will enable the investor to see where their money will go and if their investments to your company will provide them a high return.
Let Your Angel Investor Be a Part of Your Company: Let the investor contribute a few things to your company like planning your business and let them have some control on your business. Through this you can earn respect from them.
Starting a business is a big thing. It is not a simple task and it requires hard work. But there are ways for you to immediately strengthen the foundation of your business. And getting an angel investor is one of the best ways. So, be sure to follow these steps on how to get an angel investor and ensure your success in business.