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attract angel investors invest business

How To Attract Angel Investors To Invest In Your Business

Posted on by omniflow

From all the ways to secure investment for your business, angel investors are one of the most viable ways to do that. When it comes to finding and subsequently attracting angel investors, there are ways to get noticed by them. In most cases, you’ll be the one looking for them, as opposed to them looking for you.

So if you’re interested in learning how to attract angel investors to invest in your business, here is an article for you.

Make It Easier For Angel Investors To Understand Your Business

Even if angel investors are actively looking for investment opportunities, that doesn’t mean they will jump at the opportunity to invest in your business.

These people are considered very smart. After all, they have multi-million dollar businesses. Even they are worth millions, if not billions themselves. So that means angel investors do know how to scout for potential investment opportunities.

And one criterion they oftentimes look at is how easy to understand a potential investment is. So the first thing to do is to make your business easy to understand.

According to this infographic, most angel investors put their money in fintech, eCommerce, food tech, SaaS, and more. Considering that all of these fields are difficult to understand by many people, you need to make it easier for them to understand your business. Even if you think they know nothing about your field, they most certainly do.

Have A Business Plan

A business plan will help you in many ways. One way is that it will make your business easier to understand. But even more so, a business plan contains everything that the average person needs to know about your business.

It’s safe to say that this is the most important piece of document angel investors will look at. They will want to know how you plan on making money, what business model you’re using, and how you plan on advertising. They will also want to see a prototype of your product, but that isn’t always the case.

Some companies offer a service, and the service is explained in the business plan. If you’re thinking about appearing before an angel investor without a business plan, you better be ready for disappointment.

Attracting an angel investor means explaining the business process from start a finish. A business plan does that.

Make Profits Before Seeking Investment

Very few angel investors will want to put their money into your company before they see profits. When in a meeting with a potential investor, they will ask about your finances. They will ask difficult questions and require proof of profits. Expect questions related to anything from profit margins to expenses and yearly gains.

If you’re not ready to answer these questions, then you’re not ready for an investment. Considering that investments are crucial to prevent a company from going under, you best start working on perfecting your business model.

Show them your weekly, monthly, and yearly profits first, and ask for investment later. If you’re not making profits, they won’t bother talking to you.

Prove You Are the Person They Should Do Business With

Angel investors are attracted to strong personalities and entrepreneurs that are full of energy and optimism. In the business world, there is no room for pessimism and failure. Only those that can lead a company will survive.

When looking to attract these people to join your project, you have to show the determination, character, and energy that you can indeed lead a company to greatness. This might sound difficult for younger entrepreneurs, but many angel investors invest in the person rather than the company.

If they see that the person is willing to do whatever it takes to succeed, they will know the business will as well. Proving that you’ve got what it takes to succeed is no small task. Many entrepreneurs fail before they eventually succeed, and that might be the case with you.

Life is a never-ending chapter of failure and success. And so is business. After all, it took Thomas Edison 10,000 failed prototypes before he eventually created the electric light bulb.

Find Angel Investors In Your Niche

We made the point earlier that most angel investors specialize in a few fields. Well, that doesn’t mean you won’t find angel investors that specialize outside those fields.

Regardless of what sort of company you’re trying to build, you will never attract investors that don’t invest in your niche. Despite how much you want to get Mark Cuban on board, he very rarely invests outside fintech.

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DEAN | 30 | BUSINESS CONSULTANT

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