How to Find the Right Angel Investors | Silicon Valley Bank

Strategic connections can help a startup more than big checks early on

As an early stage collapse, you ’ re probably already thinking about the future big milestone : a series A investment, which will provide the capital you need to scale, equally well as institutional establishment for you, your idea and your team. Getting there wo n’t be easy. In fact, only 20 percentage of companies that raise a seed cycle ever go on to raise a Series A, according to an psychoanalysis of more than 35,000 startups by Radicle Labs .
indeed what distinguishes the successful ones ? We work with more than 5,000 seed-stage startups, and, while there ’ s no single predictor, we ’ ve found that the companies that do best tend to choose initial investors for the guidance they can provide, not inevitably the size of the control they ’ re offer .
In fact, strategic assistant from an saint is, in my opinion, the most valuable asset any early stage company can get. And it ’ s deserving accepting a smaller check mark or less-generous terms from person who can introduce you to potential customers, suggest ways to improve your product or provide access to a network of future investors .
These contacts likely will have the biggest impact on your achiever and, finally, your ability to pitch VCs successfully. Focusing your fundraising on well-connected angels immediately not merely will give your clientele a head start, but besides will save you from having to look for these connections later—perhaps after you ’ ve already given away some of your company to investors who aren ’ thyroxine as helpful.

Strategic help from an angel is … the most valuable asset any early stage company can get.

Connecting with Angel Investors

figure that you ’ re going to burn through at least $ 500,000 before you raise a series A. And, yes, getting to that amount will be daunting enough without the add challenge of limiting your potential investor pool to people whose experience aligns with your business plan. But that ’ s startup life. Hopefully, this international relations and security network ’ t the first time you ’ ve learn it ’ s going to be a draw of work .

“Finding the right angel investors is going to take a lot of meetings—more than many entrepreneurs expect.”

fortunately, there ’ s a strategy. It ’ mho no guarantee of success, but it ’ s a way we think maximizes your chances of getting the confirm you ’ ll need .

1. Master your LinkedIn-Fu

Start by building two lists : one of angel investors with relevant submit matter expertness or who are well-connected in the field you ’ rhenium target, and another of people you know or can get an presentation to. You can build these using LinkedIn. The angelic spot is people who are on both lists—they ’ re your starting point. But as you ’ ll see, it will make sense to maintain two lists .

2. Start with friendlies

It ’ randomness going to be tempting to use that connection to an a-list VC. But most seed-stage companies aren ’ thyroxine fix to pitch a top investor or flush take an basic meet. Most times, you ’ re only going to get one shoot with these people. If you don ’ t have traction with customers and a floor that ’ randomness been refined through dozens of pitches, you risk being forced into conversations before you ’ re cook for them.

alternatively, reach out first base to people you ’ ve worked with ahead or know personally. If you don ’ t have anyone like that in the both-list category, find the people who are connected to the insiders and ask to meet with them .

3. Focus on feedback

never use a meeting to ask for money. rather, use the time to share your estimate, your business plan and progress to date, and to solicit any advice you can get. Your goal should be to get person excited about what you ’ re doing and get an agreement to stay in refer .
Everyone knows you need money. But few investors will ever cut a check based on an initial meeting alone .

4. Plan on drinking a lot of coffee

Finding the properly angel investors are going to take a fortune of meetings—more than many entrepreneurs expect. A dear predominate of flick is 50 introductory meetings .
But these meetings are a great opportunity, even when they don ’ thyroxine lead to fund. You ’ ll besides start to build a net, which will pay off boastfully when you start to hire .
As you talk to people, you ’ ll hone your lurch. You ’ ll want 90 second and 5 moment versions down solid. You should be able to cover why your company matters and why it ’ randomness relevant now, your team, product and market, your go-to-market design, customers, prospects and growth strategy .

5. Get plugged in

Join groups like Startup Grind, read a bunch, lease in on-line conversations. Events can be a great resource, but be judicious and decide which events to attend based on who is in attendance and who the speakers are. Go with the goal of meeting those people .
You ’ ll want boyfriend founders in your network. Don ’ t obsess over person stealing your idea, as there ’ s indeed much more that goes into building a successful inauguration. The advice, connections and ability to commiserate that can come from a close relationship with another founder at a similar stage more than outweighs any risks.

We often talk about the dispute between smart money and dumb money. In both cases, you ’ re getting person who is banking on your success. But alone the smart-money investor has the know and connections to help you get there .
You ’ re going to want a partner who will put in time on your behalf, going over product specification, arranging meetings with potential customers and helping you find more investors. In short, you want measure. It ’ ll be a set of cultivate. But from what we ’ ve seen, it ’ s the best investment you can make .
For more helpful tips for early stage companies, check out Startup Insights, fully of stories from the front man lines of entrepreneurship .

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