IS ANGEL INVESTING RIGHT FOR YOU?
Is angel funding right for your company? Below is a check list that will help you to decide if and when you should seek angel investment. In addition to these general questions, please refer to our ‘Investment Criteria’ page before talking to Cambridge Angels about funding.
Is your team, driven, coachable, and willing to cede some control and decision-making authority to outside investors?
Do you have an identifiable market segment? Is there a demonstrable and significant demand for your proposed solution?
MARKET SIZE AND GROWTH RATE
Is your target market large and growing? Can your chosen segment(s) enable the creation of a sizeable business?
Have you identified all potential competitors? Do you understand your company’s differentiation points? What barriers to entry will help your company to maintain a competitive advantage?
Have you proven the concept behind your product or technology? Can this be confirmed with data or by objective experts? Have you produced a comprehensive business plan to commercialize the technology?
PROTECTED INTELLECTUAL PROPERTY
Have you protected your intellectual property? Have you performed an exhaustive search to be sure that you are not infringing on patents or trademarks held by others?
Do you have a plan to achieve widespread market penetration for your products and services? How will you do this as efficiently as possible? Will you create an internal, direct sales team, or will you rely on external channel partners?
Can you demonstrate how high margins (15%+) and consistent cash flow growth will be achieved?
Do you require between £50,000 and £500,000 to finance growth activities, including product development, recruiting key staff, launching sales and marketing activity?
Have you developed reasonable financial projections - including an income statement, cash flow and balance sheet and supporting spreadsheets - based on logical, realistic assumptions?
Do you have a clear exit strategy that will enable angel investors to generate a return of at least ten times their initial investment within five to seven years, or five times their investment in two to three years?
Have you developed a comprehensive business plan that articulates your key business strategies for how you will grow your venture?
If you would like to learn more about how business angels operate in general, please refer to our Angels section.