Angel investors provide early-stage funding and guidance for startups. They typically invest smaller amounts than venture capitalists and get involved at earlier stages. The document discusses different types of angel investors, their roles in filling funding gaps, differences from venture capitalists, investment profiles seeking high returns, and considerations for entrepreneurs seeking angel funding.

1. Angel Investors Your New Business Financial Supporter Mingles Tsoi 2008.12.10

3. The Context of Raising Capital

4. How things have changed? Now Past Great time to be a buyer Great time to be a seller M&A More demanding less loyal Lot of shadow alliances Customer acquisition/retention Low rates, more attractive, but much tougher terms Term sheets negotiated, less tendency to borrow Capital formation Hard to keep folks happy, they want to be informed Excessive salaries, overnight millionaires Motivating/compensating your team Nowhere to run, nowhere to hide 3 monkeys & euphoria Deal with bad news Offensive strategy Defensive strategy Intellectual property Get the customers, maintain demand exceeds If built, people will come, look marvelous on paper Infrastructure/system & staffing Defer if it can be deferred Spend if it can be spent Capital expenditure No exit, built to last In through the out door, built to flip Exit strategies Doing more with less Doing less with more Resource management

6. Capital formation strategic pyramid IPO VC seed funds informal VC large-scale loans private placement angels small business funding support from family, friends, key employees your own money

7. Capital formation strategies debt equity cost of capital credit terms interest rate amortization penalties pledged equity terms valuation dilution control dividend redemption rights

8. Capital Financing Triangle © 2005 All rights reserved

10. Balancing four critical factors Capital Return Control Risk

11. Personal Golden Circle © 2005 All rights reserved Trustworthy sources

12. You are here or DEPARTED APART PE / V C Expansion Early stage Start-up Pre-start

18. Equity Gap between Sources of Finance Cheaper sources of capital, such as bank financing, are usually not available for most early-stage ventures, which may be too small or young to qualify for traditional loans.

20. Business Angels in relation to Risk

21. The Pros and Cons of Business Angel Investors

22. For Angel Investors

30. For Start-up Entrepreneurs

31. Different steps that exist in the process of finding finance for his/her project

35. Factors drive value in venture-investing Clearly defined sales & marketing strategy Intellectual asset harvesting & management systems Recognizable brands & industry/peer respect Transparency in accounting and financial systems Culture of innovation and adaptability Commitment to strong/proper governance GROWING COMPANY VALUE DRIVERS

36. What are the venture investor really looking for? The business plan should always address the areas shown above to ensure there will be a first meeting Marketing & Branding Strategies Durable Revenue Streams Management Team’s Ability to Lead/Execute Path to Profitability is Clear Large and Clearly Defined Target Markets Strong Base of Loyal and Diversified Customers Strategic Alliances, Channels, & Networks Defendable Competitive Advantage (IP) Growing Company

37. Suggestion for Change

39. Books recommended for reference http://www.anobii.com/mingles

40. Mingles Tsoi Start-up consultant www.entrepreneur.hk mingles.tsoi [email_address]