What questions should entrepreneurs ask an angel investor to determine if there is a potential fit?

Well, what you want to know about the angel investor are the following:

  • Are you as excited about this as we are – what is your view of the opportunity?
  • What do you think will be the challenges in the journey in achieving the potential?
  • What is your expectation on return on your investment… and in what time period? What kind of an exit are you hoping for?
  • What can you help us with, apart from the money?
  • Why did you decide to invest in us?

In a lot of cases, because they typically invest in several startups, angel investors may have a causal interest in your venture. (Some call it the ‘spray & pray’ model where they invest small amounts in a number of companies that ‘seem’ nice and hope that some of them deliver on the potential promised). Your goal should be to get the angel investor super excited about the opportunity and the potential, and engage him/her as much as you can in helping you in the venture. Often warm introductions and perspectives from past experiences are priceless.

Author: Prajakt Raut

Prajakt Raut is the founder of Applyifi.com, and author of the book for startups - ‘Starting Up & Fund Raising’ Prajakt personal goal in life is to encourage and assist a 100,000 people to become entrepreneurs. _____________ Prajakt is the founder of Applyifi - an online platform that provides startups a 36-point scorecard and assessment report on the venture's investment readiness [www.applyifi.com], and helps them improve their odds of getting funded. Prajakt is also the founding partner of The Growth Labs, a platform where growth-stage companies get sharp, incisive advice from senior professionals and experienced entrepreneurs. [www.thegrowthlabs.in] Before starting Applyifi, Prajakt was the head of operations at IAN, founding member of a leading incubator, and the Asia-Director for TiE (2004 - 2007). Previously Prajakt had co-founded Orange Cross, a healthcare services company, and was part of the founding team member of Idealake Technologies. While in college Prajakt had founded a printing business and has spent over 10 years working in leading advertising agencies. Prajakt’s book, ‘Starting Up & Fund Raising’, helps startups understand an investor’s perspective, and helps them improve their odds of getting funded. The book also helps entrepreneurs understand the building blocks of a business.

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