Where to Find Angel Investors

Angel investors are wealthy individuals who provide capital to startups. For a startup with little, if any, revenue, funding by an angel investor may be indispensable for its growth and could make the difference as to whether the startup has a chance to succeed. Where to find angel investors is a challenge in itself because angels usually are not listed in directories or have websites. Finding potential angel investors may be easier than ever before, but finding the right angel for a new business takes work and the consideration of multiple factors.

Personal Network

The most effective way to locate angel investors for a startup is a founder’s personal network or the personal networks of his or her personal network. Founders should ask their contacts to introduce them to others. Unless angel investors know founders, the investors likely will not invest in the founders’ startup after the first pitch. This is why it is import for a startup to tap into personal networks and seek introductions to angel investors before capital needs to be raised.

Networking Events

In places like Silicon Valley, there are multiple startup and entrepreneurial events every weekday night and on Saturday. These events are publicized in Meetup, Eventbrite, StartupDigest, Zvents or online editions of news media. Not all of the events have angel investors in attendance, but a number of startup events have speakers who are angel investors and are willing to speak a few minutes after the events. Every major startup event has at least a few angel investors in attendance. Other events have angel investors in the audience seeking deal flow. Angel investors usually do not raise their hands and announce their identities to avoid attention, which means startups need to be clever to find the angel investors in attendance.

Angel Group Websites

Many of the more prominent angel groups have websites and contact forms and places where pitch decks may be submitted. Not all investors respond to unsolicited inquiries, but a surprising number of them do respond if the email solicitation piques their interest. Note that email solicitations should not be painful for an angel investor to read, but at the same time have to intrigue the angel group enough to induce a response. More prominent angel groups receive more than 10,000 submissions a quarter, so startups must be succinct in describing the startup’s business and the opportunity and be creative in standing out from the crowd. The startups which are funded are the ones that have stood out from the competition, but might not be the best startups.

Angel Forums

The Angel Capital Association is good source of contact information for its members.
http://www.angelcapitalassociation.org/entrepreneurs/links-to-groups/

Online Startup/Investor Connections

Several angel investor / startup connection services are online, the most prominent of which is AngelList. These services allow startups and angel investors to connect and review the other person’s profile. These mediums have significantly expanded the reach of startups in the angel community. Of course, many people know about these services, which means startups need to determine how to standout on the platforms.

AngelList or www.angellist.com

AngelList is one of the more popular and effective online platforms for startups that are seeking funding, co-founders or employees. Through the platform, startups are able to post a profile that describes the startup, the founders, the board, the advisors and its service providers.

FundersClub or www.fundersclub.com

FundersClub enables startups to receive small investments from numerous angel investors by aggregating individual investments into investment funds under which FundersClub will be the general partner and receive incentive-based compensation on the gains from the investment but no other compensation. FundersClub claims to curate the best startups and accept only 5% of startups that apply. FundersClub also provides the legal investment documents and a platform to sign the documents via e-signature.

Gust or www.gust.com

Gust provides a platform for startups to connect with angel investors. Startups and angel investors create profiles with a brief description of their businesses, founders and management teams.