Angel Investment Toolkit

This toolkit is a guide to navigating the angel investment process to help determine if you are ready for investment and what is involved in negotiating a deal and working with investors.

1. The Checklist – Are you ready?

2. The Angel Investment Deal Process

3. The Templates

4. The Deal Timeline

5. The Blog:

Negotiating with Investors
What Angels Look For

Are you Ready for Angel Investment?

The below checklist will help you prepare new and review your existing documentation and help you determine if you are ready for angel investment.

Checklist

Documentation

Do you have a presentation / pitch deck, outline business plan and financial forecasts that will attract investors?

Presentation / pitch deck

1. What is the problem you are addressing and how are you solving it?

2. What is your back story and relevant experience?
How much experience of managing a growing company do you have and how are you addressing any skills gaps by building this into your current and future team?

3. Potential Market
Can you clearly demonstrate the market potential and how your company can grow to take a share of that market?

4. Customers and sales
Do you have evidence from current or potential customers that they will buy your product or service?

5. Competition
Competition clearly identified, both direct and indirect – can you clearly explain your unique selling points / competitive advantage and how you will establish and protect this position?

6. What is your plan to repay shareholders? Do you intend to sell the business or float on a stock market? Or, will a larger venture capital company come and invest further and buy out the smaller shareholders? This needs to clear at the point of approaching angel investors. 

Financials

Clear and credible figures that demonstrate the projected profit and loss, cashflow and balance sheet for a minimum of three years. We understand that these may change, but we are looking to see that the company is scalable. 

Investment Amount

How much investment are you looking for and what will it be used for over what time period? Product development, marketing, tooling, increasing capacity, team expansion, location expansion – these are typically the areas of spend that an investor will see as fuelling future growth.

1. Is this enough for your monthly costs for at least 12 months of cash runway?

2. Have you included salary costs for yourself that are comparable to the market standard in your industry for this role?

3. Have you included remuneration / reward for advisers that will now be part of your formal board?

4. What is the investment mainly going to be used for e.g product development, staff recruitment, sales and marketing, new premises etc?

Valuation

This is to be a fair and reasonable agreement depending on the potential risk and reward to reflect the amount the company is worth. This takes into consideration the stage of development, whether revenue generating, validation from (potential) customers, previous funding, grants awarded and the product market fit, i.e. is there a clear demand for your product / service.

It might be useful for you to know that research indicates, in certain sectors, the valuation you get for your company can be increased if you have a product that is already selling. Please bear this in mind when you think about timing of seeking angel investment.

If you feel you are ready for angel investment, the first step in our process is to complete the application form to tell us about you and your business.

Other options if you are not ready for angel investment

Mint Ventures prefers to invest at the early seed stage when there is a proven concept and market validation from potential customers. Bootstrapping (using all your funds and friends and family to get to a point of revenue) and crowdfunding can however be useful earlier funding to get your company to this point.