Pitcher perfect – Wooing angel investors

May 22, 2012 - Tags: Innovation Financing Startup

If you need a new source of financing to start or expand your business, consider turning to angel investors. These individuals can help by investing their own money in return for equity in your business. Pitching angel investors may be a good idea after seeking funding from family and friends, before trying venture capital firms.

With one chance to make a perfect pitch, careful preparation is key. Take time to find angel investors who are good matches for your business, and set up an opportunity to make your pitch. Building a relationship is better than a generic approach like sending out a mass email.

To prepare, look at your pitch from the investors' perspective. You need to convince them that they'll make money and be able to exit with a profit when ready. Present your vision simply, and avoid getting bogged down by too many slides.

There are many points to consider while preparing your pitch:

  • Presenting a prototype rather than a concept shows that you invested time and money into producing something and can take a project through to the end.
  • Focus on the solution your business provides. What problem will it solve and how? How are consumers currently solving the problem?
  • Show how consumers benefit by choosing your business over the competition.
  • A well-crafted business plan is essential. How will you make enough profit to satisfy your investors?
  • Rather than using statistics and other numbers, draw the investor in by painting a more accessible picture. Personal examples can help. But do have a budget to show how you will use the money.
  • Flexibility is an asset. Be open to changing your product as the market demands.

While it is essential to be confident, be prepared to address how you will manage a variety of risks. But risk can be offset by opportunity: investors can offer you more than just money. How will you make the most of the wealth of experience, advice and networking opportunities that an angel investor may bring to the table?

Get more ideas from our sections on Private sector financing, and Is your elevator pitch ready? as well as our post entitled Accessing equity financing

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