How to Get Funding From Angel Investors For Startups 2022: Best Process Explained

I believe you do have a great business idea of billion dollars, and as it is more than a worthy business plan, it is not supposed to be executed in lakhs of rupees.

You need more investment, and you are about to drop that business idea because you are not having enough funds to start it.

If you are doing that, then STOP NOW! I HAVE A SOLUTION FOR YOU TO GET THE FULL FUND FOR INVESTMENT!

Yes, you read a perfect and correct thing, you are able to get the amount for investment whatever you want, but your business idea must be worthy.

It doesn’t matter about how much investment you need for your startup, whether it is 20 lakhs, 50 lakhs, 1 crore, 7 crores, or 10 crores.

You will get enough amount from the angel investors who are ready to invest their money in your startup project by accomplishing some essential criteria.

According to THE ECONOMIC TIMES, the Indian startups raised the funding of $21 billion from different investors.

In this article, I am going to show you how you can raise funding from angel investors for startups.

I know you might have many questions in your mind like:

  • Who are angel investors
  • Wha are angel investors
  • When should you find them
  • What they see in startup
  • How to choose the right investor
  • Why do they raise funding
  • How you can pitch them and close the deal
  • What should your startup idea have
  • How to contact angel investors etc…

Be relaxed! Keep reading this article, all the questions are going to be answered in-depth in this article.

How to Get Funding From Angel Investors For Startups

Each thing in the world is quite easy if you are having a roadmap of the process to achieve it.

If you want to get funding for your startup from angel investors, then first you should know who are the angel investors, what are they, how do they approve your request, and all that.

After having all the details and roadmaps, you can prepare yourself and your ideas in the best way to present to the angel investors.

So, let’s dive into the concept of angel investors and conclude how your business model will get approved for funding from angel investors in the first attempt.

Who are Angel Investors?

Angel means a person with the supreme natural power, when you begin your startup, first you invest your personal savings, then your friends and families support you.

Then some people within your society and relatives start taunting you about not starting the startups and starting a job instead etc…

Angel investors are people who don’t know you personally, and there is no surety about the success of the startup which you are going to begin.

But they support the startups, and that is why they are called angel investors.

The question is: who are the angel investors? Is there any company with which they are associated or they are separate?

Well, there’s not any firm or company called angel investors, angel investors are individual people who are entrepreneurs or have been entrepreneurs, the people on seniors designations in the big startup companies.

Like, Vijay Shekhar Sharma- Founder of Paytm, Kunal Shah – founder of Cred, Kunal Bahl – Founder of Snapdeal, etc…

Apart from entrepreneurs, the chief designated of high reputed successful startups, like senior wise presidents, chief executive officers, chief business officers, and this kind of designated people become the angel investors.

In short, angel investors are the people who have lots of money which they have invested in many resources like stocks, crypto, gold, and they are in search of taking more risk.

A more important reason for investing the money in early startups is to build the entrepreneurship ecosystem of India in the world and share their experience with entrepreneurs.

Things That Angel Investors Consider Before Investing in Your Startup

If someone is going to invest money in your business idea and business plan on your trust, then they are obviously supposed to have some verified data from your end.

Angel investors are not going to fund around 1 lakh or 5 lakhs rupees, they are willing to invest crores of rupees in your business plan, so you should have enough preparation before presenting your business model to them.

So, before approving the fund for your idea for a startup, the angel investors consider some aspects which are below.

The Targeted Market Segment

First thing is that the market segment in which you are going to enter, must be big, it should be at least a few billion dollars.

The future potential of your startup should be at least more than 1 Billion Dollars, or minimum to minimum it must be more than 100 Million Dollars i.e. 700 crores rupees.

Because the angel investors are not interested in the low market segment business models, and eventually, no one from the big businesses and entrepreneurs will be interested in so.

Moreover, if your business is small, like 50 crores, it may be good enough for you and your family, but investors will not get enough return.

And, if investors are taking a high risk, then they expect a minimum of 10x returns.

So, you should make sure that your business idea should be in the direction of solving a big problem which is being faced by a huge community of people.

In addition, your problem-solving way must be easier, affordable, or include the addon benefits which does not have with anyone else apart from you.

You Should Have Enough Insights

Uniqueness always wins. You should have the insights which are not identified by the other startups yet.

Moreover, you should create an MVP and test in the market, receive the feedback of the audience, make improvements.

These insights help you to raise funding from the investors because they can trust you for your products as they have been tested already.

Product Must Easily Scale up

You need to make sure that you are making easily scalable products, figure out the benefit of the company and are supposed to capture the market with the different resources.

The funding offered is between Rs 10 lakhs to Rs 10 crores, and they also consider the founding team.

They consider the potential of your team, if any experience person or not in your team, and whether they will be able to run the startup in a proper way or not.


What does an Angel Investor Look For a Startup?

When you approach the funding to the angel investor, he looks for some potential in your startup plan.

Again, because he is going to invest crores of rupees and dollars in your business plan, so, you are supposed to prove your plan.

So, here are some essential aspects which you should present to them while approaching the angel investors for the funding in your startup idea.

Pitch Desk Should be Ready

You should have the ready pitch deck in which you will explain to them about your business process.

  • What is the market size
  • How are you entering the marketing
  • How and why your product is better than the competitors
  • What is the future potential and USP

These all data should be in a crisp way with full clarity, and it should be data-backed.

They will not accept the random planning like you say that we are having this idea and going to make the billion dollars company in such years. It is not acceptable.

Keep The Product Demo Ready

While approaching the angel investors, it is very recommended that you should have the demo product ready.

Because nowadays, the funding segment has become very complex and competitive you should not give them a single chance to reject them.

So, you should have your demo product ready in which you would have pitched the whole business idea.

Along with these all details, you need to mention the funding relevant details, like:

  • How much funding you require
  • Why do you need that much funding
  • How will the funding money be used
  • How much percentage will you dilute from your shareholding

You need to fix all the details in the business plan, and now the convertible note and safe option have been introduced in which you get the funding first, and then you need to give the details.

But in this case, also it is recommended that you would have all the preparation done in advance.


How to Find Angel Investors?

Do you have to pay any charges or fees to find angel investors? Do you need any authority person in between to find an angel investor?

The answer is: No!

You can find angel investors free of cost, and the easiest way to find them is Google. Just search on Google ” Angel Investors in India”, you will get a list of the angel investors of Inda.

angel investors for startups
Angel Investors list

After you make the list of angel investors, then shortlist the investors who belong to your business segment.

For example, if you are running the startup of e-commerce, then the commercial investors only will be beneficial for you, right?

They will help you in building the connections, they will be able to share their experience with you for your startup subject also.

For example, if you are running a fintech startup, getting a banking license is not easy stuff, there they can help you.

So, this is an essential step to shortlist the proper investors and check which startups they have funded in your segment already.

Moreover, you can find the investor on LinkedIn as well, LinkedIn is one of the most favorable online platforms for businesses and professionals.

If you are having a common connection, you can fetch the reference, if you get an introduction, it is very beneficial for you.

For example, you don’t have any connection, then you can find the email on their profile as well and pitch them for funding as well.

While writing the email, you need to take care that you introduce yourself and share the details about your startup in minimum words.

Conclusion on How to Get Funding From Angel Investors For Startups

Getting funding for the startup is not easy stuff, but if you are clear with everything, and succeed to convey your project to the angel investors, you will not face more problems.

In this article, I have provided the best guide to raising funding from angel investors in India which will help you to convenience the angel investors for investing money in your project.

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