Put yourself in the shoes of the gatekeeper at an Angel Investment Network for a minute. You are inundated with pitch decks that you have to assess to identify the 10 start-ups who will pitch at your next event. You need to keep your Angels happy with high quality investment opportunities, your time is limited and you have 20 businesses from the same sector – only 2 can pitch.
We recently attended Waterkant 2019 in Kiel, North Germany, a festival of all things start-up and scale-up in the region. Listening to a Q&A session presented (excellently) by an active angel investor (part of Baltic Business Angels), we were reminded of a significant pain experienced by all start-ups: submitting a pitch deck and never hearing back.
In this blog, we share 6 learnings from the Q&A session (and our own experiences) that will help ensure your pitch deck is top of the pile of submissions to Angel Investment Networks across the EU.
Before we look at those 6 learnings, it is important to know that in our experience the best time to ask an Angel Investor for funding is when you don’t need the funding. To explain that a little, an Angel (or group of Angel Investors) is most likely to invest in your venture if there is an existing relationship and they have been involved with developing a business plan and funding strategy over a 3-6month period. So, approach Angel Investors early, 6months before you think you will need funding and build a relationship.
The 6 learnings are focused on getting your pitch deck noticed and your cleantech venture invited to a pitch session at an Angel Network:
- The right amount of funding – Angels will typically provide £25k to £100k of funding. It is possible to secure funding from multiple Angels to bring this to the £250k mark, but this is likely to be the upper limit. If you need more money, you need an alternative funding source.
- Do your research – Check if the Angel Network and the Angels that are active in that network do invest in cleantech ventures. It should be possible to fund out from their website, linkedin profiles or by calling to check. This seems obvious, but it is surprising how many entrepreneurs just take the ‘scatter gun’ approach. Best to target Angel Networks precisely.
- Team – Funding an individual entrepreneur is risky – what if they go sailing and never return? What if they get sick? You stand a much higher chance of being noticed if you present a well-balanced and functioning team.
- Look and Feel – The design and presentation of your pitch deck is crucial to getting noticed and invited to pitch. Keep it clean, modern and professional. Include the key elements of the business and think about backing it up with a video of the team talking about the business in their own words.
- Short Pitch Video – This video is becoming a standard requirement from Angel Investors. You can film it yourselves using a smartphone. Demonstrate that you are a team and you are passionate. Don’t give a 10minute technical monologue with the rest of the team sat nodding in the background.
- Growth Potential – Show that the business has the potential to generate a 10x return on investment within a 5-7 year period. Angels are generally in it for the money alongside the relationship with the entrepreneurial team. Show them the money.
If your venture is more aligned with social, ethical, community returns as opposed to financial, there are Philanthropic Angel Networks that will understand your pitch. We have experience of developing bids and securing funding from Angel Investors. If you would like our opinion on your venture’s chance of success, please complete our information request form here and we will be in touch to discuss.
Try putting yourself in the shoes of an Angel Investor – this is likely to result in the right amount of empathy and a commitment to building a long-term relationship with these crucial early-stage funders. Also remember that there are significantly more ideas than there are Angel Investors so be prepared and take the process seriously.
Feedback and Questions
We would welcome any feedback from you and would be happy to answer general questions about Angel Investment funding.
Related Content and Comments
Please share this post with other members of your team or with your wider network. Here are some related articles and videos:
- The Baltic Business Angels (North Germany)
- The Business Funding Show (London) is a great chance to meet Angels and other funders
- Interview with Terri Mead (Angel Investor) about what an Angel Investor does