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How to Get Funded by an Angel Investor
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Angel investors are like mentors, and entrepreneurs who seek funding from them should expect the investors to have more than just an interest in the company. Angel investors are known for active participation in their invested company, including the involvement in day-to-day company operations and business decision-making. While the process of obtaining angel capital is quite competitive, entrepreneurs should consider the nature of the relationship with the investor, as well as other key components that may increase their chances of obtaining angel capital. Below are some steps new business owners can take in order to get funded by an angel investor.

1. Direct association
One of the best ways an entrepreneur can increase their chance of getting funded by an angel investor is when they either personally know the investor him/herself or have been introduced to the investor by a mutual friend. Having this common ground greatly improves the chances of obtaining funding for a new business venture because of the established trust in knowing someone directly. While obtaining funding is not always guaranteed, no matter how close or distant the relationship is, the entrepreneur can use this direct association to his/her advantage and work hard to win the investor over.

2. Entrepreneur due diligence
Another way in which new business owners can increase their chances of receiving angel funding is by investigating prospective angel investors and/or groups. Through this type of due diligence, the entrepreneur will have a better sense of who will fund their business, the individual profiles of the investor(s), and the companies the investor(s) have funded in the past. This knowledge will enable the entrepreneur to sort out the best investor according to previous experience and success. In addition, the entrepreneur can also network with people at conferences, seminars, and business meetings, bringing the entrepreneur closer to meeting an angel investor and to the prospect of getting funded.

3. Promising pitch and business plan
When meeting with angel investors, entrepreneurs need to present a flawless pitch and prepare detailed business proposals regarding their product or service. A flawless pitch will show angel investors the entrepreneur is taking the business endeavor quite seriously and reveal they have invested ample time in preparing the verbal presentation. In addition, presenting a business plan is a sign of a responsible entrepreneur who is ready to take their new business to the next level.

4. Financial projections
Before approaching angel investors for funding, entrepreneurs first need to analyze the cash needs of the new business. It is imperative this be done before the meeting because it is quite difficult to obtain more startup capital if the initial financial figures are not accurate. With this in mind, the entrepreneur is encouraged to present the amount requested and financial projections for the new company to the angel investors. While the financial forecasts are only calculated predictions, these figures are very important to an angel investor since they prefer backing companies that show a fairly high promise of financial success. When entrepreneurs present calculations of expected returns, it shows angel investors they have researched their financial needs, the existing market behavior, any major competitors, and consumer responses to the products being offered.

5. Management team
While preparing to meet with angel investors, entrepreneurs need to prepare the biographies of the entire management team. This is needed because angel investors are not only interested in the elevator pitch and business proposal; they are also interested in the management experience of the people who will be running the new business. A successful company always has the support of a solid management team, and angel investors always pay close attention to who these people may be.

Conclusion
An entrepreneur looking for startup capital for a new business needs to begin their search early. It requires a lot of time to find sources of funding, as well as potential angel investors who can close the deal. On average, it may take up to six months to get funding since the angel investor screening process is quite competitive. This is also the amount of time required for venture capitalists to make their decision. Therefore, it is only appropriate for a new business owner to search for funds early on and be patient with the whole application and screening process.

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