All about finding an angel investor for your business

If you are the owner of a new business and finding it difficult to obtain funding you may want to consider trying to find an angel investor (or two). Many times businesses that are too new, too risky and unproven, or too offbeat to qualify for traditional bank financing and attract venture capitalists, can find funding through an angel investor. An angel is a private investor, (often a successful entrepreneur), who invests in small businesses close to home for a variety of economic and personal reasons. Many times angel investors are friends, relatives, or colleagues. Successful entrepreneurs, (especially retired ones), are especially likely to become angels. Although the types of angel investors vary widely, angels are believed to provide billions of dollars in capital to entrepreneurs every year. Based on demographics, many studies characterize angels as follows:

• They are wealthy
• They are usually self-made as opposed to inherited wealth
• Most often they are in their sixties; almost never below forty
• Angels mostly prefer to invest in companies they are familiar with. They usually seek out small and growing companies in their own industry.
• So now that you know what an angel investor is you may be wondering where you can find one.Here is all about finding an angel investor for your business-
• Look among the people closest to you.The main reason for this is that you have a greater chance of securing financing from people who know you. After exhausting those possibilities then you can ask your business associates to ask their acquaintances. However you should keep in mind that the farther the relationship and the lesser the prospective angel knows you, the lesser the chances of securing the investment unless they have a unique understanding of your product.
• Stay local-Just as your chances of securing an angel investor are better from someone who knows you (or at least knows of you) your chances also increase if you can find a prospective angel investor in your geographic area. Remember that angel investors tend to like to be able to visit their investments and often times want a hands on approach-this is much harder if they are not investing in a local business.
• Always be networking-One of the first things you should do is join a professional organization or trade group for your industry. Try to attend the meetings on a regular basis since this is the best way to get acquainted with successful business owners in your field who might now of possible angel investors.
• Ask people in the know-Your attorney, accountant and banker might all know information that can lead you to an angel investor.This is because they will all have clients who frequently invest in new and growing businesses.You may want to discreetly inquire to them about people who appear to be the most successful members of your industry.
• Use the Internet-Do not overlook the power of searching on the internet. Some sites provide listings of angel investors per geographical location, while others provide focused advice on getting investors for your small business. A quick search may lead you to just the right angel investor for your business.

As a final note remember that the rule is always to raise money at the right time. Convincing angel investors to part with their cash to support your venture takes a lot of time and hard work. You need to be sure to dedicate enough time and budget in your search for financing.Once you find a prospect, you should send a letter requesting a short meeting to discuss the proposal. A more effective approach if possible is to be personally introduced to the angel investor by a common friend. This is because people are more inclined to be receptive to offers from other people if the request come from people whom they trust. Final if the angel investor shows interest you should make sure to have a well-written business plan. Your business plan should especially emphasize why you need the financing and exactly what you plan to do with the money.