Companies that are in search for investors in order to start-up their business or just to expand it, often appeal to venture capitalists, private or angel investors to obtain the needed funds. This is a better option because investors, unlike banks, also offer advice and guidance for the company. But you should know that there are a lot of differences between these types of investors and you should take them into consideration when deciding where to apply for your funding project.
Click here to download your angel investors funding formula <==== The most important difference between venture capital firms and angels is that angel investors are more interested in start-up companies than venture capitalists. Angel investors are successful business persons who are interested in investing a certain amount of money in a promising company in return of a percentage of the company's shares. Although venture capitalists have the same features, angels are more concerned about start-ups because they require a lower investment and the risks that are to be taken by the investor are lower than in the case of a company at the second or third level of expanding. Even though angel investors provide not only money, but also guidance and connections to the business world that can help the company grow and even though there are lots of companies looking for external funds, the angel investment resources are not yet used to the full advantage of businesses worldwide. The most widely spread mistakes made by entrepreneurs looking to raise funds from angel investors are the following:
- They don’t know how to present their business proposal in a pitch. You should always keep in mind the fact that a pitch generally lasts for 30 minutes and that you have to deliver all the important data regarding your company in that time-frame. Unless you do so, you may easily loose the pitch despite of the brilliancy of your business idea. Moreover, you should take into consideration the fact that you will be constantly evaluated during the pitch because the type of management you promise to provide is just as important as the business idea in itself.
- They don’t negotiate effectively with the angel investors in front of them. You should always keep in mind the fact that angel investors get thousands of funding demands a year, but they can only fund the best of them. Your negotiation techniques and your entire offer is the business card they can see from the beginning and it generally turns out to be just a barometer showing the way in which the company is more likely to develop.
Click here to download your angel investors funding formula <==== The Growthink presentation you can access by clicking the link above can help you understand the mistakes you may make when seeking for funding and it also offers you advice on how to correct them. In 1999, more than 2,000 entrepreneurs managed to obtain over $1 billion in funding after using this product.