If you think your company is ready for an angel investor, look no further. San Francisco based AngelList is a company that connects startups with angel investors and has now launched a new program for Canadian startups. The premise of the program is simple but effective, AngelList will help you connect with an angel investor and has a deadline of August 30.
Angel investors usually invest in small startups or entrepreneurs. The capital angel investors provide may be a one-time investment to help the business propel or an ongoing injection of money to support and carry the company through its difficult early stages. Additionally, Angel investors provide more favourable terms compared to other lenders, since they usually invest in the entrepreneur starting the business rather than the viability of the company.
When a startup is taking its first steps, an angel investor to help them along can be a great boon. They are essentially the opposite of venture capitalists and are typically affluent people who have a minimum net worth of $1 million and an annual income of $200,000. Some Angel investors invest through crowdfunding platforms online or build angel investor networks to pool in capital. They are also called informal investors, angel funders, private investors, seed investors or business angels.
Angels usually want a portion of your company, valuable equity that you would instead not give away, but remember that letting an angel have a slice of the pie can be a lot better than spending years in denial and rejection.
AngelList Canada has a great line-up of angel investors listed. People that could make a difference to the companies they invest in. The angels on the AngelList platform include Hootsuite founder Ryan Holmes, Daniel Debow, co-founder of Rypple and Workbrain. U.S. angels include Tikhon Bernstam, co-founder of Parse and Scribd; BetterCompany founder and CEO Tom Williams and entrepreneur Naval Ravikant, an AngelList co-founder.
The company puts entrepreneurs through a vetting process before linking them to the angel most suited to them. AngelList Canada is run by Toronto entrepreneur Alex Norman who has recruited other investors to screen the applications from entrepreneurs for the program for quality and growth potential before presenting them to the big angels.
[pullquote align= “normal” cite= “Alex Norman”] “But AngelList came here because we believe there are a lot of great Canadian companies that can become world-beaters.” [/pullquote]
“Startups can’t normally get to people of this calibre,” Alex Norman recently told a media organisation. “But AngelList came here because we believe there are a lot of great Canadian companies that can become world-beaters.”
Money is not the only advantage that angel investors bring with them; they come with business experience that can translate into startups making fewer mistakes and also great opportunities that a new business may not readily have access to otherwise. The angels are looking for companies that are scalable and capable of addressing huge markets, and technology companies are not the only ones being favoured.