Is there a small business that hasn’t needed more capital at some stage of development? And is there a small business owner who hasn’t thought of angel investors as an ideal source of the capital needed? But finding angel investors isn’t like finding clams on the beach; the search is more similar to finding the pearl. Here’s how to find Angel Funding investors that will be most likely to want to invest in your business.
Know Who You’re Looking For
Your chances of connecting with the angel investor you need will be much better if you keep this profile of the “typical” angel investor in mind.
Angel investors look for companies with growth and export potential says Allan Riding, an expert on angel investing and professor at Carleton University.
They understand that it may take several years before their investment will pay off – although they also expect to be well compensated for their risk.
Look Close to Home
Because so many angel investors like to play an active role in the business they invest in, they prefer to invest in businesses that are close to home.
“An angel wants to be nearby so they can drive over to talk to the principals,” says Jim Orgill, managing director of advanced technologies for the Business Development Bank of Canada.
Network, Network, Network
In most cases, you need to be referred to an Angel Funding investors. They’re not hanging out on the street waiting to talk to whoever comes by.
So to find angel investors you need to get to know the right person (the one who can refer you to the angel investor you’re looking for), which means immersing yourself in your local business and social community.
Focus on business owners – as these are the people who might be or become angel investors themselves or know an angel investor. Join business and trade organizations and regularly attend the meetings.
Joining civic and community organizations are also great for networking. Attend trade fairs and events. Get your face and your name out there and meet as many people as possible.
Realize That Many Angels Don’t Fly Solo
While there are some Angel Funding investors who invest entirely on their own.
Many operate as part of an informal network or syndicate where they can pool their resources and share the risks.
Check with the Business Development Center, Community Futures Office or Economic Development Centre where you live; there may be an active group of angel investors in your community.
Use the Connection Services Available on the Internet
You may be able to hook up with an angel investor through one of the websites that provides entrepreneur and angel investor matching. If nothing else, you can at least get your business proposal before a wider audience.