Preparing For Angel Investment

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Preparing For Angel Investment

  1. 1. Preparing for Angel Investment Padmaja Ruparel Indian Angel Network
  2. 2. Angel Investment <ul><li>Investments in early stage / start up companies </li></ul><ul><li>Addresses the gap for funding early stage companies </li></ul><ul><li>Investors access constant flow of high quality deal flow to spread their risks </li></ul><ul><li>Network’s multiple domain expertise enables exploiting opportunities across sectors </li></ul><ul><li>Angel investments - a new asset class </li></ul><ul><li>Provide entrepreneurs strategic inputs, advice and mentoring with access to valuable networks </li></ul><ul><li>Opportunity to create disproportionate wealth creation for all stakeholders </li></ul>Commitment of Money, Time, Expertise & Networks
  3. 3. Indian Angel Network <ul><li>India’s first and largest business angel group </li></ul><ul><li>Over 80 successful entrepreneurs, dynamic CEOs part of the Network </li></ul><ul><li>Network members from across India and overseas </li></ul><ul><li>Concept has found resonance with corporates like IBM, Google, Venture Funds like SIDBI, Greylock Partners, SAP Ventures, etc. </li></ul>
  4. 4. Where are we today <ul><li>15 investments made to date across multiple sectors </li></ul><ul><ul><li>Knowcross - Sanshadow - Techlit </li></ul></ul><ul><ul><li>Authorgen - Madhouse - Mobilenxt </li></ul></ul><ul><ul><li>Electronic Tender - Vienova - Viedea </li></ul></ul><ul><ul><li>Druvaa - Eureka - Robhatah </li></ul></ul><ul><ul><li>Stelae - Digitorque - Hungry Bangalore </li></ul></ul><ul><li>Over 50 deals received per month and several deals on the anvil for investment </li></ul><ul><li>Operations in Delhi, Mumbai and Bangalore, processes established </li></ul><ul><li>Several partnerships forged </li></ul><ul><ul><li>TIE – ideal feeder for deal flow </li></ul></ul><ul><ul><li>IVCA – ideal partner for exits </li></ul></ul><ul><ul><li>NASSCOM – ideal partner for innovative cos. in IT / BPO </li></ul></ul><ul><ul><li>NEN – ideal feeder for seed stage deal flow </li></ul></ul><ul><ul><li>FICCI – ideal feeder for deal flow </li></ul></ul><ul><ul><li>UKIBAN – Cross border Angel Network </li></ul></ul><ul><ul><li>FBA – Partnership with Femmes Business Angels in Paris </li></ul></ul>
  5. 5. Process at IAN <ul><li>Every entrepreneur who applies given an opportunity to present to IAN </li></ul><ul><li>Quick feedback and mentoring at every stage of the process </li></ul><ul><li>1 st level : 15 mins. elevator pitch by entrepreneur – explain the proposition, plan and the passion </li></ul><ul><li>2 nd level : 45 mins interaction for detailed pitch </li></ul><ul><li>Subgroup of investors for term sheet, Share purchase agreement and investment </li></ul><ul><li>Post investment : value add continues </li></ul>
  6. 6. What do Angels look for IAN assessment process
  7. 7. The Market <ul><li>What is the space where you will operate </li></ul><ul><li>Is it large and rapidly growing </li></ul><ul><li>What is the competition to your product </li></ul><ul><li>What is your strategy to deal with competition </li></ul><ul><li>Has any market validation happened </li></ul>
  8. 8. The Proposition <ul><li>Clear definition of product or service </li></ul><ul><li>Is it already developed or can you validate that it can be developed </li></ul><ul><li>Have you clearly defined your customer </li></ul><ul><li>Why is your product / service necessary </li></ul><ul><li>Is it doing something Different / Differently </li></ul><ul><li>Is it “need to have” / “nice to have” </li></ul><ul><li>If IP based, patenting status </li></ul>
  9. 9. Execution <ul><li>How will you deliver </li></ul><ul><li>Experience of pilots, prototypes etc </li></ul><ul><li>What is your sales / marketing plan </li></ul><ul><li>Scaling up plan </li></ul><ul><li>Risks / mitigating plan </li></ul>
  10. 10. Team <ul><li>Team is fundamental to early stage venture, providing the best collateral for an investor </li></ul><ul><ul><li>Track record </li></ul></ul><ul><ul><li>Coverage of skills – finance, technical, marketing, etc </li></ul></ul><ul><ul><li>Stock/compensation plan </li></ul></ul><ul><ul><li>Advisers, etc. </li></ul></ul>
  11. 11. Financials <ul><li>Current / Projected for next 3 years </li></ul><ul><li>When will it break even </li></ul><ul><li>Self investment & funding received till date </li></ul><ul><li>Investment sought </li></ul><ul><li>Valuation expectation </li></ul>
  12. 12. Exit <ul><li>Building an exit option is necessary for yourself, your team, and your investors </li></ul><ul><li>Investors will monetize their investment </li></ul><ul><ul><li>How </li></ul></ul><ul><ul><li>When </li></ul></ul><ul><ul><li>What </li></ul></ul>
  13. 13. And Finally <ul><li>Put some of your skin in the game </li></ul><ul><li>Getting a high valuation early can be fatal </li></ul><ul><li>Size of the pie wins every time over share of the pie </li></ul><ul><li>Ideas are a dime a dozen, its execution, execution, execution !! </li></ul>
  14. 14. Thank you Do write in to us at : [email_address]

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