Are there certain things that really catch an investor’s attention? Yes, there are. In this article by David Nilssen, learn the three crucial factors that weigh in on all of his investment decisions.
What Angel Investors Care About Most, When They Make Investment Decisions
by DAVID NILSSEN for Entrepreneur.com
You’re an entrepreneur with a great idea and a lot of grit. You’ve researched your market, developed your product or service, assembled an amazing team and worked your financial models backwards and forwards. Now, you’re ready to launch your business, or to grow it to the next stage.
At this point, there are good reasons to consider pitching to investors instead of pursuing traditional small business financing. Michael Howell, co-founder and CEO of Dolly, which helps students and homeowners with micro-moves, says that in today’s startup environment, “The key currency of success is learning what works and what doesn’t as quickly as possible. Speed is critical.”
Raising funds, Howell says, allowed his own team to try more ideas and learn more quickly. “Deeper pockets allow you to hire more and better people,” Howell says. “In this competitive marketplace, that can be difficult for an unfunded startup.”
According to the Center for Venture Research, angel investors are the major source of seed and startup capital for entrepreneurs. As an angel investor myself who funds startups in multiple companies, I can speak to the satisfaction angels feel when an entrepreneur nails his or her pitch. Potential investors become engaged allies at this point: We’re excited about the chance to help a business hit a home run.
What excites an angel investor?
What I’ve observed across the many pitches I’ve received, and the many discussions I’ve had with other angels, is that the most successful formula for winning investors’ hearts is a big idea with a compelling solution and an entrepreneur whose pitch hits the following three notes:
- A huge opportunity. Show that the market your company can win is enormous. This may be a relative number depending on your size, but as an investor, I can tell you that we seek large returns. You need to demonstrate why your idea is a $50 million, $500 million or $5 billion opportunity and how it will surpass the competition. Prove to me that your product or service boasts an unfair advantage by answering a problem that hasn’t been addressed in the current market. A breakthrough solution. …
- A breakthrough solution. … Read the Entire Article at Entrepreneur.com