How to Convince Angel Investors to Invest in Your Business

Getting an Angel Investor to Invest In Your Business

Once you have located potential investors who are in a position to give you the startup capital that you require, how do you really convince them to give you that money and clinch the deal. The kind of presentation that you need to make to an angel investor is the same as what you would make to a venture capital firm. An angel investor usually likes to see the following things in a business before she can be convinced to put in his own money.

Strong management. The investor needs to be convinced that the business is in good hands and the business will be handled professionally.

Track record. If you have already been doing business, what has been the track record of the business so far.

Proprietary strength. Propriety does not necessarily mean that you must have the patents, copyright or trade marks on all your products but simply that your product or service should be innovative and interesting enough to develop a strong consumer base.

Window of opportunity. Investors also like to see whether your business product or service is something that it is taking advantage of the lack of competition or demand not meeting supply kind of a situation. If you are a business who is getting into the field where there is nobody is, your business stands to grab the lion’s share of the consumers before other businesses.

Market potential. Investors also like to see the potential for growth in the market as well as the demand. If your business has the potential to grow as a change order franchisee in various locations in different cities and states, the investor is likely to be more interested.

Return on investment. Most of the investors will expect to make a minimum of 20 to 25% over 5 years. However, they may be willing to accept a lower rate if your business is a low-risk venture.