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Sibi Paul Shares Top 7 Tips on How to Attract an Angel Investor in Your Startup

Sibi Paul

Investors play a key role in financing startup businesses that have exponential growth potential. Angel investors prefer to invest in seed-stage, startup-stage, or early-stage ventures to help them obtain the desired growth in the industry. However, securing funding from an angel investor can be tricky, especially if you’re a first-time entrepreneur. 

Sibi Paul is an Indian entrepreneur and investor who has been reigning over the modern internet space. With his vast digital marketing knowledge and skillset, he assists businesses and entrepreneurs grow their businesses online. His growth hacking strategies and mindful leadership qualities have made him an inspirational figure before all those new-age entrepreneurs who are planning to enter the Indian Startup ecosystem. Owing to his adept knowledge in the field, Sibi Paul is sharing 7 tips for those entrepreneurs who are struggling to attract angel investors for their startups.  

1. Polish Your Networking Skills

When it comes to sourcing angel funding for your startup business, networking becomes more than just meeting people. Every entrepreneur should foster a strong networking skill set if they want to raise money from angel investors for their budding startups. If you have the opportunity to attend business events, conferences, or mixers, you should take advantage of it. You can also reach out to potential investors and if they find your startup a scalable and viable business, they will definitely invest in your business. You can also join angel investment networks if you want better fundraising opportunities and high-quality mentorship.

2. Do the Industry Research

It is true that angel investors invest in those businesses that solve unique industry problems with their products or services. However, to assess the originality and problem-solving capabilities of your business idea, you need to invest a great deal of time and effort in industry research. Without being guided by your assumptions, do your homework and back your idea, product, or services with industry facts and figures. Investors will only show interest in your business if they see that you know your industry inside out. 

3. Do not Inflate Valuation

Business valuation is far from being straightforward for any business but it plays a crucial role in securing angel funding from an investor. You need to determine the worth of your company before asking for money for it. So, while asking for funding from an angel investor you should be ready to answer why you are valuing your company in a particular way. Therefore, never try to inflate your company valuation as investors will be able to see right through your inflated valuation.  

4. Choose the Right Investor

An angel investor brings more than just capital to the plate. They add strategic value to your startup business with all their connections, experience, guidance, and leads. Therefore, you should take your time before choosing the right investor for your business. If you are approaching an investor, you should research about them first to understand their industry expertise and what value they can bring to your business. Meetings also can be used to garner feedback from them and let them understand the complementary goals and vision. It will give an idea of whether this partnership will work or not. 

5. Pay Attention to Your Pitch

A polished pitch will not only help the investors to get a clear picture of your business but also will give them an idea of whether you understand your business or not. Therefore, make your pitch clear and concise so that the business does not become confusing to the investors. At the same time, develop effective listening skills as your investors will have questions and concerns. Also, persuasion and negotiation skills can aid the pitch as you sell the idea to the investors. Moreover, your pitch needs evidence to support all the claims regarding your product or services. Therefore, develop research skills for a successful pitch.   

6. Focus on a Core Competency

An entrepreneur is not someone who does a number of different things at the same time. Rather, an entrepreneur is someone who does one thing differently. Therefore, while starting up, every entrepreneur should pay attention to developing one core competency in the form of unique technology, product, or service to gain a competitive advantage in the market. They must understand the core competency of their business so that it does not get difficult for the investors or customers to understand what your business stands for. They need to have a 100% understanding of what they are solving, how they are solving, and why they are solving. Otherwise, it will be harder to raise money from an angel investor,

7. Sell your energy, passion, and dedication

Most of the time, more than business ideas, products, and services, investors invest in the entrepreneur. Therefore, entrepreneurs must be able to communicate their energy, passion, and dedication to their business with angel investors. They must utilize the pitches, meetings, and other events to convince the investors about their competency. If the investors have confidence in you, they will not only invest in your business but also will not try to take control of your business from your hands. 

A seasoned entrepreneur Sibi Paul is well-versed about the problems a budding entrepreneur faces in order to source funding from an angel investor. Without proper financing, your business cannot function successfully and be profitable. According to an IBM Institute study, 90% of Indian startups die within the first five years of inception and one of the major reasons behind this is the lack of financial support. So, this article by Sibi Paul will help all those entrepreneurs who are finding angel investors an implausible task.

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By TIS Staffer
the authorBy TIS Staffer

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