Where to Look for Angel Financing and Venture Capital 

     
If your business proposal or plan doesnít reach the right target audience of investors then your company will never receive the funding its deserves. For many entrepreneurs, the most frustrating aspect of capital raising is finding the best way to direct their valuable time and resources in identifying potential investors. In this case, itís not just who you know, but how to find them.

In attempting to identify potential investors, donít be frustrated by your lack of direct contacts. First consider who you do know and evaluate their ability to facilitate an introduction. This may include bankers, lawyers, professional advisors, and CEOís of other companies funded by private equity. A referral to an investor from a source they know and trust is much more likely to result in a meeting or a request for information than an unsolicited proposal.

Also be prepared to invest the time in conducting relevant due diligence on your targeted investor audience. Investors typically have specific investment criteria defined by preferences based on a companyís industry, stage of development, capital required and geographic location. Identifying investors with preferences that match your company profile enhances the probability of generating interest. Also identify other companies in your sector and geographic area that have raised private equity funding and solicit the investors that committed capital to these ventures.

Practical resources for identifying angel finance providers and venture capital investors include local business centers, chambers of commerce, universities and libraries. The internet is also an excellent source for research on individual venture capital firms, finding angel investment clubs and identifying events aimed at connecting investors with entrepreneurs. Paid subscriptions, such as the US-published Prattís Guide to Private Equity Sources or hiring a credible capital finder may also be worth the investment. The key is to be resourceful, persistent and fully leverage your contacts and research skills.

Other resources

  • How to manage business cash flow effectively
    There's something you can never afford to forget when you are running a business out of your home: cash is king! Whether it is a multi-billion dollar empire, such as Microsoft, or the tiny mom-and-pop convenience store on the street corner, cash is the life blood of the business.
    Read more: Managing cash Flow
  • 7 Tips For Obtaining Angel Investor Funding
    If you have a start-up company that is looking for up to $500,000 in financing, your best option is to locate and meet with Angel Investors. Angel Investors are people that invest their own money in start-up companies. Many of them started out the same way, as an entrepreneur with their own start-up company. They like the entrepreneurial spirit and are looking to fund a start-up or two and offer their own business advice and wisdom. Also, their financing terms are less painful that what a venture capital firm would offer and they can usually make a decision in a few weeks on whether or not they will finance your company. Now you know why they are called "Angels".
    Read more: Angel Investor Funding

 

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