About Angel Investing
Angel groups benefit entrepreneurs through exposure to a wider set of potential investors, and a structured process that facilitates a relatively quick and efficient investment decision. Angel investing represents a significantly large and growing portion of early stage capital available to start-up companies. We encourage you to read Angel Investing 101 and Considering Valuation if you are new to Angel investing.
Is an Angel Investment right for me?
It is important that you understand who we are, how we operate, what we look for in potential investments and what we expect in return.Angels in Angel groups typically invest between $10,000 and $100,000 per transaction individually and from $100,000 to $500,000 as a group. Most groups invest in one to four transactions per year. On average, Angels are patient, with an average term for holding an investment of six years. For the risk and added value they provide, Angels seek returns of at least ten times their investment.We receive hundreds of business plan submissions. Our funding process involves a thorough screening process where approximately three companies per month are selected to present to our members for funding consideration.
What we’re looking for:
We evaluate based on management team, market opportunity, growth potential and a host of other factors. To stand out from the rest of the crowd make sure that you meet our investment criteria and that you are fully prepared with a polished business plan and presentation.
Consider these basics:
What are you really passionate about?
Great success can be accomplished only with passion, so it’s vital that your primary activity/goal is one for which you have great passion.
At what can you be the best in the world?
“Best in the world” might be domestic or highly-focused, e.g. “best in the world at selling ads in Australia” or “best in the world at providing water efficiency to homes in Melbourne”, or it might be a global vertical, e.g. “best in the world at providing free web email to consumers”, or it might be a global horizontal, e.g. “best in the world at providing a platform for mobile phone messaging”, or it might be market specific, e.g. “best in the world at providing risk management to the USA financial services market”, whatever it is, it captures/defines what you can do better than any other company on the planet.
What best drives your economic engine?
As a for-profit business, identify your one economic driver that has the most significant impact on your economics. Where will you get your revenue, how will you continue to extract increasing profits and why will your customer keep buying?
Who will want to buy your company?
As investors we need to know that there are credible and identifiable acquirers of your business who will pay a healthy premium (10x or better our money) to have what you will build. You should already have a good idea who those companies are and why they will value your business/intellectual property/customers.
Read this book and article for useful, practical, Australian insights Raising Angel & VC Finance & Art of the Investor Pitch from Tom McKaskill
About Angel Investing