Who is an angel investor?
Angel investors are the people who provide capital to potential startups in exchange for a piece of the enterprise, generally in the form of equity or royalties. They, generally, are experienced entrepreneurs or ultra-wealthy people who understand the realms of business.
When exactly does an investor becomes an angel investor?
Everyone who invests in a startup is not an angel investor. Not all investors are angels. An investor who puts his/her experience, value, and knowledge along with the money is known as a true Angel investor.
Anyone can invest capital in an idea. But if the investor is giving them money and leaving right after putting it, then he is not an angel. To be a real angel investor you have to guide the startup founder towards success, you have to take a close look at their strategies and reframe them if needed. Thus, being an angel is nowhere a cakewalk. It’s like teaching your younger self how to be successful all over again.
How does an angel investor finds relevant startups to invest in?
Angel Investors taps startups from networks of angel investors. Every metropolitan city has a network of their angel investors. Such networks help angels a lot to find a plethora of deals and startups to invest in.
Besides that, LinkedIn is also a tremendous platform to find talented and amazing startup founders. LinkedIn, with its thousands of creative and professional minds, is serving the consistent and quality lead flow to dedicated angel investors.
Another platform where angels can connect with Startup founders is Clubhouse.
What do angel investors expect in return?
Generally, angel investors expect annual returns of 20-40%. This percentage can vary but not much. Besides, on an average basis, an angel expects to get the complete retrieval in 5-7 years. Yes, the risk is there because angels don’t invest in a business, their investment is in the idea. But due to their fabulous business experience and being an entrepreneur, they understand where and when to take risks.
What is the difference between an angel investor and venture capitalists?
Both angel investors and Venture capitalists invest capital in the businesses. Of course, they hope for the best returns along with some calculated risks. But are they exactly similar? Nope.
Angel investors’ sole purpose is to support an idea or cause. Often they are families or friends who are ready to financially back their loved ones’ ideas. Or sometimes, the reason for angel funding is when there is a match of values and goals.
Whereas, venture capitalists invest to buy the startup in the coming time or to make a long-term high return.
Angel investors most likely fund the startups when they need the financial back extensively. That’s why the name is Angel. Because all they see is your idea and talent. Angels invest in startups even before they prove themselves.
On the other hand, venture capitalists fund the businesses after they set themselves on the ground firmly. They tend to bore fewer risks.
Like these 2, there are numerous other differences between Angel Investors and Venture Capitalists.
How to be a successful angel investor?
To be a successful angel investor, you have to use your kind heart along with a clever mind. Because in angel investing the main goal doesn’t lie around getting a good return. The main objective of truly successful angel investors is to grow the business and the founder like his own.
Thus, on the same note, here are some tips you can follow to be a successful angel investor:
What kind of investors we work with?
We work with angel investors, angel networks, venture capital funds & family offices.
What are the kind of investments size you do?
- Angel investors – $20K – $50K
- Angel network – $50K – $3M
- VC – 2M – 8M
- FO – $20K – $1M
What is the process to onboard an investor?
Step 1 – Mountain Hub team connects with an investor through various channels.
What is the process to invest in any of Mountain Hub’ startups?
Step 1 – Mountain Hub team will send deals to Qualified investors as per their preference.
Does a qualified investor have to bring in some expertise other than money?
Yes. Most investors do bring in expertise other than capital and that really helps the startups to grow from where they are.