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Is angel money the best choice of capital for your company? To learn more about angels -- what they are looking for, and how to connect— check out this deck for its look at how you can connect with angel investors, top questions angels ask, the angel decision making process and timeline, and more.
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How to Raise Angel Money: A Guide to Raising Capital
from Angel Investors
About Your Hosts
2
Deepak GuptaManaging Director
Sirk RohChief Operating Officer
What’s an angel?
• High net worth/Very high net worth
• Live in tech hubs, typically invest locally
• Well-educated• Part-time investor• Sees 50-250 startups/year• May be member of an angel
group
Well-off, either from tech/finance
What kind of companies do angels invest in?
• Companies who are in seed or early stage
• Diverse: In technology, clean tech, fin tech, healthcare
• Looking for: Solve a problem, management team, IP, business model
How do entrepreneurs connect with angels?
• Full time, 12 hours/day, 4-6 months• Rely on your network• Must have persistence and outstanding
communications skills• Objectives
o Get introductions to 100-250 investorso Meet 50-100 investorso Follow up with 25-75 investorso Conduct diligence process with 25-50 investorso Get checks from 8-15 investors
Questions angels askProduct What’s your business about? Why will people use your
product?How do you make money?
Market How big is your market? Who’s your competition? Distribution?Have you talked to customers? Product-market fit?
Team How did the founders meet?Who is on (and not on) your team?
Risks What is the biggest problem you need to solve now?
Technology and IPFunding Justification/Use of Funds
MilestonesFinancial projectionsThink ahead to Series A
Questions angels don’t ask
• Do the founders like each other?
• Do I trust you?• Can you sell?• Can you build a team?• Can we work together?• Is anyone else going to
invest?• Why isn’t XYZ going to crush
you?
Non-rational criteria
Founders
Do I identify with you?
IndustryUniversityExperience
Product
Cool factor
Resolving personal pain
Market
Personal experience
Interest
Angel decision-makingtimeline
Contact
Meeting #2
Meeting #5
Meeting #6
Meeting #3
Meeting #1
Meeting #4
DUE DIIGENCE
$ TERMS
INTEREST
Decision-making process…
Elevator pitch
Pitchdeck
Founder info
ProductMarketBusiness modelCompetition
Domain expertiseIntelligenceCommunication skillsPersistence IntegrityRelationship
CustomerMarket sizeCompetition
Prob/SolutionTractionProduct-Market fit
Product overview
Market
Product
Decision-making process
Tech Financials Deal Legal
Tech team Use of fundsMilestonesGrowth plan
AmountTermsInvestors
Regulatory threatFormationStock IP
Funding Pitch Guidelines
• Tell a story• Problem• Solution• Market size• Business model• Competition• IP• Team• 10-12 slides maximum• One key point/slide: Backup data in appendix• Don’t read it from slides
ValuationsWhat is the valuation of my startup?
• Based on traction • Based on geographical comps• Entrepreneur ask vs investor tell?
Q&A and Thank You!
14
Deepak Gupta415 Jackson StreetSan Francisco, CA 94111www.seedchange.comdeepak@seed-change.com415.908.1016@Deepaksgupta500
Sirk Rohwww.earlygrowthfinancialservices.comsroh@earlygrowthfinancialservices.com415.234.3437@EarlyGrowthFS
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