Angel Funding?

Guisbuild

I'm at a crossroad in my business....looking for funding to grow in this sluggish economy. Has anyone used any funding through Angel Investors....

Looking for opinions, pros and cons.

thanks in advance.


guisbuild

awareness

• Some angels can be good partners and very savvy investors but others are not much more than well-to-do gadflys who will want a major say in your business in return for their money. Some will stay the course for five to seven years but others will want a quick return, trying to force you into expansion you can't afford or can't handle, or to go public or even sell out to satisfy their quest for profit. Before you go down this road, ask yourself if you want to give up some or all control of your business. If you really need an outside investment, go with someone who has invested in other companies - and check out the others' experience with the investor. The current poor economy could turn around with a year or two and you don't want to be stuck with a domineering, whining, fast buck partner after things do improve.

vinylguy

guisbuild,
have you found an angel ? let us know! i would sure like to know how to find one?

Publisher1

How capital intensive is your business? Do you really need the money from outside sources to grow; or are you hoping an infusion of capital will help you overcome a hemorrhaging of your current business (and you know banks aren't going to loan money?)
I'm generally very wary of 'angel investors' -- of course it helps that my business service is not capital intensive and the sales cycle isn't too long. But I'm haunted by an image at a business networking group meeting a few years ago. The organization represented high-fliers (at that time, I was 'soaring' with an ill-planned U.S. expansion), but the person at the dinner with us was crying -- it seems the venture capitalist 'angels' were pulling the plug on his well-managed business and while it was turning a profit, they were turfing the founder out.
I realize not everyone is in the same position, but I wonder if an entrepreneur really should try t o start this type of capital-intensive business in the first place; instead focusing on activities that would not require 'angels' until the point arises where, through success, you've achieved enough capitalization to have the ability to be an angel yourself!
(It is easy enough to slip up and make mistakes in business -- I did -- but thankfully the lack of external investors/obligations allowed me to shrink things down to scale, fix the problems, learn proper management and operating techniques, and begin growing again, even in a recessionary environment.)

vinylguy

thanks for the info publisher
i do not need any vested interest in my company, as a matter of fact i thought simply that it was a way to borrow money quickly and painlessly. for a short period of time.
instead of going thru the bank. but your right i don't want to answer to noone that doesn't know my biz!

BigLou

The remodeling business and angel funding are not a good fit, for many reasons:

1) Remodeling is not a capital intensive business.

2) You can't "buy" success in remodeling - throwing money at the business in unlikely to solve the fundamental problems you are experiencing.

3) There is a limited exit strategy. Investors want to know how & when they will get their money back.

4) Limited number of knowlegable investors. Angel investors invest in business they understand, and likewise, you want an investor who understand the business. You want more than just a financial investment, you want someone with industry knowledge and connections.