Do you have the zeal to start your own profitable online business but no financial support?
Worry no more, because we’ve discovered The 10 Best Angel Investors for Small Startups Online Businesses in 2023
One of the hardest realities of startup businesses is the struggle to get funding, with many businesses having to start from the ground up. According to SCORE research from 2019, 42% of entrepreneurs bootstrap their businesses, starting with less than $5,000 in cash.
When company owners reach a certain point, usually after depleting their resources or exhausting what relatives and friends are willing to contribute, they begin to consider other options. Obtaining an angel investment is one of the most appealing but difficult choices.
We’ll discuss what an angel investor is, the biggest angel investor networks, the advantages and disadvantages of dealing with angel investors, and some techniques to help you increase your chances of acquiring this type of investment. Let’s get started.
What is the definition of an angel investor?
An angel investor is a wealthy individual who invests in companies in exchange for a share of the company’s stock. These investors are more likely to back early-stage companies that aren’t yet ready to appeal to a larger pool of investors.
Angel investors are frequently more enthusiastic about a certain industry, making the startup journey less lonely and more bearable.
Because many angel investors work in groups, you’ll commonly locate them as part of one of two networks. This is mainly determined by the industry they serve or their personal values.
Let’s look at what they do in more detail.
What is the role of an angel investor?
Angel investors serve as a bridge between self-funding or obtaining funds from friends and family and acquiring investments from major venture capital firms for most early-stage businesses.
Angel investors are often wealthy individuals with considerable business knowledge who can assist the enterprises they fund. They normally take on an advising position for the leadership of a startup after they’ve invested and acquired their proper ownership.
They typically invest in businesses in which they have experience, which can make them ideal networking resources for startups. They’re frequently well-connected, and they can suggest entrepreneurs to additional private investors as their companies grow.
The 10 Best Angel Investors for Small Startups Online Businesses in 2023
10 Funded
The pitching and funding process at Funded.com is easy. The site has an A+ rating from the Better Business Bureau and has been in operation for ten years.
Funded’s Lender Match function connects pitches to the proper investors fast and effortlessly. When you sign up for the Basic plan, you’ll get a complimentary executive summary of your business plan to help you with your pitch. For a charge, you may also obtain a fully detailed business plan developed by Funded.
The basic plan is free for the first month, after which it costs $99 a month.
- Area: United States of America
- Angel Members: N/A
- Website: funded.com is the company’s website.
- Contact: (888) 223-4776
9. Angel Forum
Angel Forum is a startup network established in Canada that focuses on the Canadian market. It is a non-profit organization that helps entrepreneurs connect with angel investors.
This network operates in the British Columbia region of Canada. However, it collaborates with angel investors from all across the world, including the United States.
Startups can join for free, while angel investors must pay a $300 yearly forum membership fee. Each founder has ten minutes to pitch and additional ten minutes for Q&A at pitch events.
The network, on the other hand, has a set of criteria for determining which startups are eligible to provide these presentations at an event.
- Area: Canada and the United States
- Angel Members: N/A
- Website: AngelForum.org is the website for the Angel Forum.
- Contact:
8. Envestors
The Envestors platform is a private network of investors and founders based in the United Kingdom. It enables startups to pitch their concepts and maybe raise funds for their businesses.
The FCA, the UK’s regulatory body, has found Envestors to be compliant. It boasts a network of over 4,000 angel investors in the UK and has invested over £120 million in more than 200 potential firms over the years.
This network is equally welcoming to international entrepreneurs who may have a good high-growth business idea for the UK market. It also provides pertinent services in this regard. There are now 26 exits in the Envestors network.
- Area: United Kingdom
- Angel Members: 4,000+
- Website: envestors.co.uk is the company’s website.
- Contact: +44 (0)20 7240 0202
7. Golden Seeds
Golden Seeds addresses an issue that is sometimes ignored in the startup finance sector. Women handle around ten percent of venture money, and 13 percent of venture dollars go to firms with a woman on the team. Female-only founders, on the other hand, get less than 3% of the pie.
Women founders or companies with at least one woman in a C-suite role are required by Golden Seeds, according to their investment criteria page.
Otherwise, things will continue as usual. The network comprises 285 angel investors and has invested over $140 million in more than 200 women-led businesses.
- Area: United Kingdom
- Angel Members: 280+
- Website: Goldenseeds.com is the company’s website.
6. AngeList
AngelList is a massive startup platform. It has more than 5 million members, 100,000+ startups, employment, and investors who are all working together to make things happen. On this platform, you can raise funds from angel investors for free.
With over $1 billion flowing through the site, AngelList has been responsible for over 35 percent of top-tier venture capital deals in the United States.
Startups have the option to raise funds as well as hire employees. Software engineering, data science, product managers, designers, and other positions are all available.
There are more than 2 million candidates, including over 700,000 developers looking to work with companies. Furthermore, the platform hosts 100,000+ startups of various sizes.
Product Hunt is another function that allows you to see what’s fresh in the market. Syndicates to investing with well-known angel investors, as well as free startup tools.
- Area: International
- Members: 5 million+
- Website : angel.co
5. Gust
Gust.com is the company’s website.
Everything a platform needs to prosper is included in the Gust platform. This network makes it easy to find support with everything from company formation to funding rounds.
On Gust, you’ll find over 800,000 companies and 80,000 investment experts. This also makes it a very large network, where a lot of things can happen.
Gust Launch is a company-as-a-service provider. It assists you in forming your firm and running it in the manner that investors anticipate. Non-disclosure agreements, the formation of a board of directors, a stockholder agreement, and the adoption of bylaws are all examples of this. All of these factors contribute to your funding prospects.
Then there’s Accelerate, a service that assists you with the launch of your product. It covers all legal stumbling blocks, provides access to a community, and offers over $100,000 in savings from partners like AWS, Hubspot, and legal assistance.
Finally, Gust Raise makes it simple to assess your business, acquire audit-proof values, cut legal costs, and locate the proper investors to support your new startup.
- Area: International
- Members: 800,000+
- Website : Gust.com
4. Network of Angel Investors
The Angel Investment Network is a global community of investors and entrepreneurs looking for capital. Despite the fact that it began in the United Kingdom, it now has 30 branches and activities in 80 countries.
With approximately 270,000 investors and 1.3 million startups seeking investment, this network is also rather substantial. These users come from all over the world, hailing from various nations and speaking a variety of languages.
You can either register directly on the website or look for investors in your field. You can also choose a certain country or region to look through.
This network’s accounts range from Novice, which is free for a 30-day listing, to Pro, which costs £149 for a 90-day listing, Global Pro, which costs £249 for a worldwide listing, and Executive, which costs £2,499 for a 120-day listing.
- Area: UK International
- Members: 271K investors and 1.3 million enterprises are members
- Website : AngelinvestmentNetwork.co.uk
- Contact : N/A
3. The ACA
The Angel Capital Association is a non-profit organization comprised of angel investors and their networks from a variety of businesses.
Despite its focus on the United States, the organization includes networks from Canada, South America, and the Middle East.
This takes the overall number of accredited angel investors to over 14,000, with over 20,000 companies in the portfolios of the members.
You can use the website to find angels, learn more about angel investment, and stay up to date on current events and news. It also provides investors with a variety of information and insights to assist them in making better bets and increasing earnings.
- Area: UK International
- Members: 30.000+
- Website : angelcapitalassociation.org.
2. Angels of Life Science
Life Science Angels is a leading angel investment firm that specializes in biotechnology, pharmaceuticals, medical devices, and diagnostics. The majority of the angel investors in this group are senior executives or founders of healthcare enterprises. You may apply for financing and get application recommendations on their website, which can be quite helpful in lowering the number of mistakes you make on your application.
1. Angels of the Tech Coast
Tech Coast Angels is a well-known angel investment firm with a network that stretches from the Central Coast to San Diego. They have over 400 investors and provide mentorship, expertise, connections, and help to companies in the form of mentoring, information, and contacts. These services are available to entrepreneurs in industries such as life sciences, biotechnology, software, and information technology.
Entrepreneurs can find information on their websites in the form of blog articles and other resources. These include information on what angel investors seek, so even if Tech Coast Angels isn’t the right fit for you, their resources may be valuable. Their social media presence is mostly focused on Facebook and Twitter, with the latter providing regular updates that might be useful for learning more about this investment firm.
0. The Angels of Hyde Park
Hyde Park Angels are a group of investors who specialize in early-stage firms that require funding to expand. Industrial technology, computer technology, healthcare services, and financial services are the primary industries in which they invest. With over 130 angel investors, they are currently the most active angel investor group in the Midwest.
If you wish to keep up with this angel investing organization, their site has about two updates per month that focus on fundraising and growth strategies. You may find them on Facebook and Twitter if you wish to follow them on social media.
How to get funding from angel investors
The following are the tips to get funding from angel investors:
1. Double-check that you’re completely prepared.
Angel investors are unlikely to give money if you offer a great idea without some sort of real backup. They’re entrusting you with a potentially large investment, so you’ll need to demonstrate your trustworthiness.
Your product or service must be finished or nearly finished, and your technology must be sound and have a lot of potentials. In most circumstances, you’ll also need existing clients or a sizable network of prospects who can be persuaded to buy from you.
Furthermore, you must have a well-thought-out, well-executed business plan in place, as well as realistic and appealing forecasts that can demonstrate extraordinary development potential.
You’ll face an uphill struggle if you try to land an angel investment without these critical criteria in place, among others. Any angel investment requires some level of trust, but clever investors don’t put their money where their mouth is.
They aim to keep the risk of their assets to a minimum. Being well-prepared — with a ready-to-sell product or service and a strategy for selling it efficiently — might put their minds at ease and encourage them to invest considerable money in your company.
2. Network as if your life was on the line.
Angel investor connections do not appear anywhere. You can’t expect a potential investor to come across your early-stage firm on their own and invest a six-figure sum out of the goodness of their heart. As appealing as that notion may appear, it’s really a wishful vision, not a viable capital-raising strategy.
In many circumstances, you’ll meet an angel investor through a referral – professional relationships are frequently the most successful way to find angel investors. As a result, networking is essential if you want to increase your chances of finding prospective funders
Attend local angel investor gatherings; – that occur on a regular basis across the country and provide a wonderful opportunity to network with potential funders.
You should also make contact with other entrepreneurs. They may know angel investors who would be interested in putting money into your business, or they may be interested in investing themselves.
When it comes to connecting with angel investors, industry-specific groups can also assist you. Joining and keeping active in such groups can connect you with like-minded entrepreneurs who can connect you with investors interested in your industry.
3. Do your homework about the investors you’re attempting to connect with.
You don’t want to go into an angel investor meeting blind. Because these kinds of relationships are rare, you’ll want to put yourself in a position to take advantage of them. This begins with an extensive study of your potential funder’s investing history and professional credentials.
Angel investors (or groups of angel investors) typically have their own set of criteria for selecting firms to invest in. So, if possible, look into who they’ve previously backed, their areas of expertise, and the type of financing they often put up
A well-crafted presentation is highly effective. It addresses the special concerns of those on the other side of the fence. If you want to increase your chances of getting an angel investment, you need to know exactly what your potential investors want to hear.
4. Prepare a smart, effective, and succinct elevator pitch
Connecting with angel investors isn’t necessarily a meticulously calculated online approach. You might meet one in person at a networking event or another professional activity in some situations.
In those situations, you’ll need a well-crafted elevator pitch that balances being informative with being
Concise: a brief, to-the-point speech that captures the spirit of your startup. Yours should be captivating and attention-getting, and it should include information about who you are, what your firm does, and your unique value proposition, as well as a call to action.
As I previously stated, seeking angel investors isn’t usually a long-term, back-and-forth conversation in which you have the opportunity to align your beliefs. It can be quite spontaneous, so be prepared to get your message over in a short amount of time.
5. Maintain active communication channels with any investors you meet.
Once you’ve made contact with a possible angel investor, you’ll need to keep in touch with them on a regular basis. After some back-and-forth, the opportunity to present for an angel investment usually arises.
Only a few — if any — angel investors will put money in your account after just one meeting. They’ll almost certainly conduct due diligence, taking the time to get to know you and your company.
Actively connecting with them aids in this process, keeps you top-of-mind, and allows you to assess whether or not obtaining investment from them is feasible. Keep in mind that “active” does not imply “aggressive.” You risk undermining their positive impression of you if you bombard them with texts and voicemails.
You want to come off as determined — that you’ll devote yourself to getting the most of their investment — but you also don’t want to appear desperate or waste too much of their time and energy. It’s a fine line to strike, but you’ll need to do so if you want to prove your worth to potential investors without annoying them.
6. Convince that you want to collaborate with them.
That “feeling out” process I mentioned with investors is reciprocal. You must interact with possible investors to ensure that you are on the same page – to ensure that your priorities and work styles are complementary.
If you find an investor that is excessively active in their involvement with your firm or who has drastically different aims for your company, you should consider other possibilities.
So until your company is ready to take off—with traction, a lucrative market, and the right people on board—you may want to hold off on devoting too much effort to the process. However, if you believe you’ve arrived, finding an angel investor can give you a much-needed injection of funds to assist you in moving forward with your huge objectives.
Do you Thing An Angel Investor is For You?
Not every startup seeks angel funding or funding in general. Whether you do so or not is determined by the aims and strategy of your firm.
Many angel investors prefer to advise the businesses they invest in, so if that’s something that interests you, look for angels who suit that description.
If not, there are huge venture capital firms that might take a more hands-off approach, and if you’d rather not invest at all, the SBIR program offers grant money.
Whatever path you take, do your homework first and check out websites like the ones listed above.
Thank You
Any comments are welcome.
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