10 commandments: how to choose and work with great angels and investors
Social network for startups, CambridgeElevator.com
attended Tech Entrepreneurs Week to hear business angel and entrepreneur, Sherry Coutu deliver 10 commandments on how to
choose and work with great angels and investors.
The tablets of wisdom were:
1 Choose angels/mentors who have an amazing network of contacts in your industry.
2 Choose an individual rather than a ‘firm’. Personal track-record and value-add are critical.
3 Choose an angel/investor after talking to their other investee companies first (thefunded.com).
4 Choose an angel investor who has gone down the path you need to go down (raising money/floating).
5 Choose an angel investor mentor who has run a company to chair your board.
6 Do not choose an investor who has restrictions which prevent them from investing more in your company.
7 Choose to listen to your investor and make sure they have time available for you.
8 Choose to communicate with your investor(s). Amazing what you can find out!
9 Know that great angels and investors help you with three sets of things: talent, customers and strategy.
10 Do not try to delegate the process to someone else!
Emphasising the need for quality backers, Coutu said LinkedIn had acknowledged that it wouldn’t be such a success without
the quality of the investors it had attracted.
Coutu also stressed the importance of thinking about scale-up pretty much from the ‘off.’ If you think your startup has
the potential to scale-up, then find a mentor with experience of scaling-up companies, she urged – and don’t limit
yourself geographically: if you can’t find the right mentor in the UK, look further afield.
Finding angels or VC backers with deep pockets was crucial, she said. Ensure investors aren’t about to run out of money
because if they fail to invest in follow-on rounds you’re screwed. The outside world won’t see it as the investor’s fault
- they will think your business is a dud.
Great investors would help startups recruit talent, get customers and help with access to key contacts and information,
she emphasised.
But she stressed the need to “close the deal. Don’t rely on a handshake. A deal with an investor will need to be
formalised.”
CambridgeElevator.com is a new business social network for startups connecting budding entrepreneurs with mentors,
investors and advisers with the experience to help them grow.
CambridgeElevator.com offers free membership
registration so sign up today!