One thing we’re hearing continually from angel investors – mind you, angel investors, not VCs – is that entrepreneurs approach them too early and without adequate preparation. Folks, you cannot (and should not) do this. Once you get rejected by one investor, you will not be able to go back to that same investor anytime soon, unless you have a strong pre-existing relationship with the individual.
So don’t blow your cartridge too soon and without doing the necessary homework.
Just look at the statistics. Angels receive anywhere between 50 and 200 deals a month, and invest in 4–20 a year. Yes, a year. That means each investor rejects anywhere between 500 and 2,000 or more deals a year. Superangels like Mike Maples get 5,000–7,000 deals a year, and they too reject the bulk of their dealflow, investing in just 12–15.
The bar is high for entrepreneurs to qualify for investment. And you get only one shot with each investor. It is excruciatingly difficult to get an investor meeting, especially for first-time entrepreneurs. If you get one, you should make sure that you are prepared for it.
Here’s my Clarify Your Story framework. It gives you an idea of the kinds of questions you need to answer to come up with a robust strategy and fine-tune your pitch. If you need to discuss specific issues here, come to our 1M/1M roundtables.
Six hundred thousand companies go out of business each year. We don’t want you to be one of those. In 1M/1M, our objective is to check the high Infant Entrepreneur Mortality – the colossal waste of entrepreneurial energy that we see around us.
Take advantage of 1M/1M.
This segment is a part in the series : Entrepreneurship Education