What is a “Business Angel” and How Can It Help You?
A Business Angel is a successful individual who provides capital to a startup company in exchange for an equity stake in the business. The profile of this type of investor is very varied, it can be a former company executive who has accumulated personal wealth and reinvests it partially, or mostly it can also be an ENTREPRENEUR who after succeeding with his own company has decided to help other entrepreneurs with attractive projects. Within the characteristics of this entrepreneur Business Angel, we can highlight the fact that it is a visionary person, which bets on projects that despite being at an early stage, turn out to be successful in the future.
As we have already mentioned, the way these angels help entrepreneurs is usually by investing their own capital in the project. In some cases they invest more than that, making their time and business knowledge available to entrepreneurs for the development of the society in which they invest. A priori, financial investment may be more attractive, but when you are taking your first steps in the entrepreneurial ecosystem and moving into unknown territory, having the first-hand experience of someone who has already traveled that path may be just what you need. Business Angels have been entrepreneurs before they have been investors, and they know a large network of contacts that can help you move into the business arena when you have just started your own project.
There are many types and sizes of business angels. Some invest between 25,000 and 300,000, and play a key role in the creation of innovative companies by supporting entrepreneurs in the early stages of their companies’ life cycle (seed and start-up), although they can also invest at any stage of development.
The most common sectors in which they usually invest are: the technological and industrial sector and within these, as I mentioned, they bet on innovative projects, that is, projects whose proposals have an added value and their competition is equal to zero (0). From there, the participation of this type of investor within the startup is not only associated with the capital it provides but also with the ecosystem and environment the project acquires greater credibility and strength. Both contributions are extremely important during the development of the project.
Large companies such as Facebook and Google had this figure in their beginnings, which shows that a Business Angel can be a key part in the take-off of your business.
How to convince a Business Angel?
Obviously there is no magic spell with which you can convince any investor to bet on your idea, mainly because he is the one who has the last word. But there are a series of recommendations you can follow to achieve this, beyond that, of course, your project is interesting and you have a solid business model. The team is very important, and you must know how to sell your idea, prepare a good presentation, and do not forget to offer something in return, because you must not ignore the ultimate goal of these investors: making money.
On the other hand, although the figure of “Business Angel” is associated with a person, there are also companies or investment funds composed of a network of entrepreneurs willing to help startups. In the case of Spain, we can highlight CENTEC VENTURES, an investment fund based in Barcelona, which specialises in finding new startups to finance projects, usually in the technology sector.
We know that from the entrepreneur’s point of view, getting investors for their startups is not an easy task. Following our philosophy of helping startups to grow, we decided to take the adventure of working together with the investment fund CENTEC VENTURES, in order to connect investors with startups through a series of pitch sessions called MONEY MAKERS.
If you have an innovative project, it’s time to apply to these organized MONEY MAKERS sessions, and hopefully be blessed by one of the angels we put on the table who are willing to invest.
Apply here: https://bcombinator.com/bcapital
Mateos, M. (2017, May 30). Where and how Spanish “business angels” invest. Retrieved January 20, 2020, en: https://www.expansion.com
Gutierrez, D. (s.f). What a business angel is and how it can help you. Retrieved January 20, 2020 from: https://www.emagister.com