If you’re an entrepreneur, you may be looking at a variety of funding sources to scale your business, including angel investors. The search for angel investors in India is a lot like looking for a needle in the stack of needles; you have to sort through a lot of them before finding the right one. 

Angel Investors IndiaAngel investors, also known as private investors, angel funders, or business angels, are high net worth individuals who extend funding to start-ups and small businesses. They may be business people, but they could also be doctors, lawyers, or wealthy relatives. 

So, how do you find and onboard them to finance your startup? It all comes down to making sure you are the right fit for each other. You have to catch their attention and earn their trust. They look for companies that have the potential to grow rapidly. They are used to their investment taking several years before they see a return on it, and are more concerned about getting compensated for the risk they’re taking on. Here’s an overview of ways to help you determine why and how to approach them.

Why choose an angel investor?

It makes even more sense to network with an angel investor as you can directly build the terms with the investor. The terms you wish to end up with are completely up to you and if they don’t seem favorable you can always decline the investment. Moreover, collaborating with an angel investor in the early stages of your business not only brings in the capital but also the expertise and contacts that can put your business on the trajectory of success.

Private investors can offer a business relationship beyond just finances, including strategic, marketing, or operational expertise. They may invest in a business once or multiple times at any required stage of a business.

So how do you find an angel investor that suits your business requirement? There are several things you can do to increase your chances of getting them to commit. Here are some recommendations.

Approach Angel InvestorsApproaching angel investors in India

The process of getting in touch with angel investors is very dependent on the founders themselves. Startup founders can reach out to individual members with their proposal or apply to present an elevator pitch when it comes to groups like the India Angel Network. After several rounds of iteration by the secretariat, entrepreneurs get 10 minutes to showcase a 5-7 slide presentation. If shortlisted, they’ll be called for a face-to-face meeting.

When you’re ready to attract an angel investor to contribute funds for your startup, prepare a solid business plan with justifiable valuations, bring together a good management team, and understand your customers.

If you’re reaching out to individual funders, make sure to thoroughly do your research. Investors likely put their money in start-ups in specific industries or based out of certain locations. See if they have invested in ideas like yours. 

Angel investors will look at dozens, hundreds, or even thousands of companies. Therefore, entrepreneurs must find a way to capture the investor’s attention without wasting too much of their own time. If you’re emailing them for the first time, use a convincing subject line. Let your email be crisp, personalized, and effective. Cite statistics and links that build your credibility. Ask to set up a meeting for a more detailed pitch.

This begins with a proper explanation of the idea, teams, the types of business models chosen, target market, and competitors. Therefore it is vital that the pitch is persuasive and includes all the key elements of your business plan. A well-prepared idea is a well-presented idea. Be ready to answer the tough and uncomfortable questions.

What angel investors look for in startups

 Angel Investors Looking StartupsTo convince investors, you have to capture their attention so they are confident about your ideas. They’re looking for a comprehensive understanding of your team, your business, the market outlook, and future plans.

  • Your team — Funders will be on the lookout for passionate, driven team members. Affirm your commitment to the start-up. Detail the educational and professional backgrounds of your fellow founders and/or colleagues that support your business. Mention previous successful ventures, if any. If the business angel asks about weaknesses, be honest with them and share plans to overcome obstacles.
  • Data — From current metrics to future projections, lay out the business analytics for the investor. This includes your revenue growth, net income, runway (cash flow projection), industry multiplier (average return on investment for business in your industry), customer acquisition cost, and lifetime value of your customer. Keep these ready beforehand so your presentation goes smoothly.
  • Market information — Investors will want to know your largest competitors and your market share. Is it an emerging market or an existing one? What does the future look like for expansion?
  • Investment plans— Of course, angel investors will need a detailed plan as to how you wish to use their funds. Be honest about potential risks that could arise. 
  • Growth, challenges, and strategy — Elaborate on your business growth plan, the challenges you are facing/might face, and how you want to deal with those. Mention any traction you’ve had, whether a successful product, partnerships, or customers, to validate your ideas. 


Angel Funding India

When reviewing an investment proposal, it is critical to determine if the founder and the investor can develop a relationship that transcends the transactional relationship between them. In fact, the personal connection is often what drives investors to back the early-stage companies. You need to keep in mind that not all startups are ready for investments and don’t necessarily get the investment required, instantly.
It is key to remember that being an entrepreneur is a long-term commitment and you need to be patient and persistent in your research. Keep trying to approach different investors in and even outside the industry until you have managed to secure an investment.

Jupiter Capital assists companies seeking investment through challenging environmental or business changes, while generating impressive income for investors.

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