Is angel funding the best funding option for your startup? How can you best attract angels? What are angels looking for? To learn more about angel investors, check out this presentation from Kevin Smith, Co-Founder and CEO of seedchange (www.seedchange.com) and EGFS (www.earlygrowthfinancialservices.com). Topics covered include: - What is an angel - Are you the kind of company that angels will invest in - How can you connect with angel investors - Top questions that angels ask - What angels DON'T care about - The angel decision making process and timeline

1. Raising Angel Money #angelmoney

2. About Your Hosts
Kevin Smith
Founder and CEO
Erika Malzberg
Chief Marketing Officer

3. Who’s an angel?
• High/Very high net worth
• Live in tech hubs
• Typically invest locally
• Well-educated
• Part-time investor
• Sees 50-250 startups/year
• May be member of angel
group
www.seedchange.com

4. What kind of companies do
angels invest in?
• Companies who are in
seed or early stage
• Diverse: In technology,
clean tech, fin tech,
healthcare
• Looking for: Solve a
problem, management
team, IP, business
model
www.seedchange.com

5. How do entrepreneurs connect
with angels?
• Full time, 12 hours/day, 4-6 months
• Rely on your network
• Must have persistence and outstanding
communications skills
• Objectives
o Get introductions to 100-250 investors
o Meet 50-100 investors
o Follow up with 25-75 investors
o Conduct diligence process with 25-50 investors
o Get checks from 8-15 investors

6. Questions angels ask
Product What’s your business about? Why will people use your
product?
How do you make money?
Market How big is your market? Who’s your competition?
Distribution?
Have you talked to customers? Product-market fit?
Team How did the founders meet?
Who is on (and not on) your team?
Risks What is the biggest problem you need to solve now?
Technology
and IP
Funding Justification/Use of Funds
Milestones
Financial projections
Think ahead to Series A
www.seedchange.com

7. Questions angels don’t ask
(but they’re really thinking…!)
• Do the founders like
each other?
• Do I trust you?
• Can you sell?
• Can you build a team?
• Can we work
together?
• Is anyone else going to
invest?
• Why isn’t XYZ going to
crush you?
www.seedchange.com

8. Non-rational criteria
Founders
Do I identify
with you?
Industry
University
Experience
Product
Cool factor
Resolving
personal pain
Market
Personal
experience
Interest
www.seedchange.com

9. Angel decision-making
timeline
Contact
Meeting
#2
Meeting
#5
Meeting
#6
Meeting
#3
Meeting
#1
Meeting
#4
$
www.seedchange.com

10. Decision-making process…
Elevator
pitch
Pitch
deck
Founder
info
Product
Market
Business model
Competition
Domain expertise
Intelligence
Communication
skills
Persistence
Integrity
Relationship
Customer
Market size
Competition
Prob/Solution
Traction
Product-Market fit
Product
overview
Market
Product
www.seedchange.com

11. Decision-making process
Tech Financials Deal Legal
Tech team Use of funds
Milestones
Growth plan
Amount
Terms
Investors
Regulatory
threat
Formation
Stock
IP
www.seedchange.com

12. Funding Pitch Guidelines
• Tell a story
• Problem
• Solution
• Market size
• Business model
• Competition
• IP
• Team
• 10-12 slides maximum
• One key point/slide: Backup data in appendix
• Don’t read it from slides
www.seedchange.com

13. Valuations
What is the valuation of my startup?
• Based on traction
• Based on geographical comps
• Entrepreneur ask vs investor tell?
www.seedchange.com

14. Q&A and Thank You!
Kevin Smith
415 Jackson Street
San Francisco, CA 94111
www.seedchange.com
info@seedchange.com
1.877.711.9883
@seedchange
Erika Malzberg
www.earlygrowthfinancialservices.com
contact@earlygrowthfinancialservices.com
415.234.3437
@EarlyGrowthFS