I’ve exhausted all my personal funding options, what now?

Depending on what stage your business is in, there are a variety of resources you may want to consider. But first you have to determine if you have REALLY exhausted all of your personal resources. Have you:

  • Maxed out your credit cards?
  • Borrowed against your home equity?
  • Borrowed against business assets?
  • Borrowed from friends and family?
  • Borrowed against your retirement funds?
  • Cashed in your IRAs?

Investors are looking for business owners who have “skin in the game.” Think of a traditional breakfast of bacon and eggs. The chicken invested but the pig has skin in the game!

I have a business idea but I’m not sure if it has merit. What should I do?

Before you seek Angel funding, we recommend that you contact one of the many Edison incubators in the region a discussion. The incubator can provide entrepreneurs with:

  • Business/idea assessments
  • Technology/staffing support
  • Access to legal counsel
  • Educational resources
  • Business management mentoring
  • Access to capital
  • Strategic business guidance

What is a technology-based business?

ARCHAngels has a broad view of technology-based businesses. You may be an ARCHAngel Company before you assume your business is not technology-based, give us a call and we’ll let you know for sure.

My business isn’t technology-based, but I’m looking for more information and financial assistance, where can I go?

We recommend that you contact the Small Business Association (SBA) for more information and guidance for your business.

Am I guaranteed to be connected with an Investor?

No. ARCHAngels provides selected companies with an audience of accredited investors that are actively seeking businesses in which to invest. However, this doesn’t guarantee that every business idea will find an investor. Many of the businesses that have presented through ARCHAngels have received the capital investment they sought. Those that have not, have met with investors who have provided a portion of the funds they needed or found valuable advice and links to other resources.

Will just one person invest in my idea?

No. Typically Angel Investors pool their money together to achieve the desired funding amount. Angel Investors may contribute a portion as little as $10,000 to the overall deal. This minimizes the investor’s risk and offers the entrepreneur a wider variety of experience in investors from which to draw knowledge and advice.

What are you looking for in a Business Plan Executive Summary?

  1. Overview
    • Product/ Service
    • Company Status
    • Investment Being Sought
  2. Product/ Service
    • Description (include pictures/diagrams if appropriate) including target buyers
    • Status in Development
    • Intellectual Property
  3. Value Proposition
    • Current products/services in market
    • Unmet needs
    • How your product/service fills those needs (and any proof of claims)
  4. Market
    • Market description (size, etc.)
    • Customer types (names)
    • Current competitors
  5. Go-to-Market Strategy
    • Channel approach
    • Sales and marketing plan
  6. Team
    • Leadership and relevant, summarized background
    • Key alliance partners
    • Advisors
  7. Financials
    • Summary pro-forma income statement (with historicals if appropriate)
    • Milestones achieved each year
  8. Exit Strategy
    • Milestone for exit, and expected timing
    • Exit approach and comparables
  9. Investment Offering Detail
    • Amount
    • Security Type
    • Valuation/ownership
    • Use of proceeds (what milestones will be accomplished) and length funds will last
    • Status of round
  10. Contact information
    • Your contact
    • Company info (web site, etc.)

How do you select the businesses that will be given the opportunity to present?

There are a variety of components that the committee reviews when selecting those business ideas for presentation at the quarterly meeting. Besides ensuring the business is technology-based, investors are looking for their potential return on investment. Your business plan summary should clearly indicate the expected rate of return and turn around time.

If your business plan lacks maturity, is not well thought out or doesn’t clearly provide a feasible business valuation, we will be less inclined to move you to the next step in the process.

How should I value my business?

You’ll want to confer with your accountant to better determine the value of your business, but an easy rule of thumb is this:

If you do not hold a patent for your process or product and if you have not sold your product to a customer, then your business will have a value far less than you may imagine.

What will the ARCHAngels sponsor do to help?

ARCHAngels sponsors work closely with every business owner to refine their business plan summary, hone their presentations skills, review the actual speech and to properly prepare them to effectively communicate their business idea to the audience.

Who is on the selection committee?

The ARCHAngels selection committee consists of about a dozen volunteers who are experienced community leaders, investors, service providers, business executives and public service members.

I’ve been approached by an investor – what are the next steps?

ARCHAngels does not get involved in the actual negotiation between entrepreneurs and investors. At this point you should meet with the investor, then seek legal and financial advice.

I’ve previously presented my business plan summary and not been selected, can I reapply?

Absolutely. If you are a technology-based business not selected because of some aspect in your plan that you’ve since rectified, or your business is further along in the process and you feel confident in being a good candidate for Angel Investment, then you should reapply. Often a business idea is not selected because the business plan summary was missing critical elements that an Angel Investor is looking for, i.e. a feasible exit strategy, management team, marketing strategy, expected market share. There is no limit to the number of times you can apply so long as some aspect of your business plan summary has changed.

Learn more about the Resources for the Entrepreneurial Path.