January 10, 2017

170: What You Don’t Know About Angel Investors

In this episode, Steli and Hiten discuss the topic of angel investors. Not all entrepreneurs are able to bootstrap a business and may need the help of outside investors. Listen as Steli and Hiten discuss both sides of the relationship—how you can find the RIGHT angel investors and what great angel investors look for in their founders. Find out how you can get the investment you need without having to sacrifice yourself or your business.

Time Stamped Show Notes:

00:36 – An angel investor is an individual who helps fund a business

01:10 – Angel investors are decision makers

01:52 – Personal relationships often become the bridge between you and investors

02:17 – Angel investors are founder-friendly

02:36 – Founders may find angel investors easier to talk to and convince

03:49 – Just like any other investor, don’t rely too much on angel investors’ opinions

04:22 – Are your investors investing because they like your content or product OR because they believe in you?

05:29 – Find investors who are OK with how you want to run your business

05:50 – Angel investors sometimes take too much time getting to know you before writing a cheque

07:06 – Don’t spend all your time raising money if you don’t have to

08:05 – The success of your business should always be on YOUR hands – not somebody else’s

09:35 – Inexperienced investors may mean trouble to your business

10:54 – You have to know your investor’s background

11:32 – The best angel investors always focus on the TEAM

12:55 – Angel investors are just investors – YOU own your company

13:59 – Pay attention to your investors’ attitude towards you and your business

14:30 – Don’t blindly take advice from your investors

16:19 – Angel investors have their differences

17:02 – Hiten, as an investor, looks for founders who have thought out their business very well

17:52 – Angel investors should base their predictions of whether a company will succeed or not ON the founders and the team

18:28 – Investors want to know if the founder can execute

19:32 – Set up a business where your customers NEED to stay and use that customer loyalty to reassure your investor that you are in control

19:56 – Investors want to know that the founders know themselves

21:11 – Find someone who is confident in what they they do WITHOUT being delusional

22:42 – Look for somebody who is balanced

24:09 – Make a personal level approach

24:13 – Sell yourself, your team, and who you are – not just your business and projections

24:30 – That’s it for today’s episode!

3 Key Points:

Keep building relationships – it can bridge you to an investor.

It’s important to know your potential investors’ background in investing.

Your company is yours – having an angel investor does NOT mean they own it.

[0:00:00]

Steli Efti: All right. Hey this is Steli Efti.

[0:00:03]

Hiten Shah: And this is Hiten Shah.

[0:00:06]

Steli Efti: In today's episode of we're going to talk about how to raise money successful from angel investors. First of all, Hiten, I'm pretty sure that our audience is fairly educated but still, a quick definition on what makes somebody an angel investor?

[0:00:22]

Hiten Shah: Yeah, usually an angel investor is someone who writes a check as an individual. They don't have a partnership. They're just one individual writing a check. Now, some people who are one individual, individuals writing checks have a small fund. Let's say a five, 10, 20, maybe even 30 million dollar fund themselves. Some people are just writing checks that are sort of personal. Many times I've done that. I don't know if you've done that ever. It's my own capital and I invest it.

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By Steli Efti & Hiten Shah: Serial Entrepreneurs, Sales & Marketing Experts, Startup Investors & Advisors, CEOs running multi million dollar SaaS Startups

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