Angel investing – What do you need to know?
In the past few years, angel investments have become one of the most popular ways to support a start-up’s business development. This type of venture capital can ensure high levels of economic and business development in any country. Angel investors provide small and medium-sized business entrepreneurs with the necessary money and hands-on management expertise to run their business ventures successfully.
There are several factors to consider when considering angel investing. As a first and most crucial point, angel investing is not for timid investors. This involves a high level of risk. It is often highly liquid, sometimes even less liquid than real estate. By investing in this venture, you trust a very new and unproven entity with your money. This is not what you should consider if you are concerned about these things.
It is also essential to consider how much your portfolio you wish to invest in private ventures. It’s a great way to build a diverse portfolio through angel investing. It is always recommended to consider angel investing a high risk/high potential investment part of your portfolio and weigh its overall value accordingly. Most experts recommend that you do not invest more than 5% of your portfolio in high-risk alternative investments, such as angel investing.
AIM or Atal Innovation Mission is a prime government scheme for startups, established by NITI Aayog to encourage innovation and entrepreneurship across India. The idea behind this startup scheme is to provide an environment for academicians and scholars to generate ideas for innovation, research, and develop them at the school, university, research institutions, industry and MSME levels.
To facilitate their objectives, AIM has created Atal Tinker Labs and Atal Incubators. Under this government scheme for startups in India, the Atal Incubation Centers (AICs) are awarded a grant-in-aid of ₹10 crores for a maximum of 5 years.
Startup industries eligible for financial and infrastructure support are chemical startups, technology hardware, aeronautics, aerospace and defense, healthcare and life sciences, agriculture, Artificial intelligence, AR & VR, automotive startups, construction, design, non-renewable and renewable energy and telecommunication startups
In India, there are several angel groups, such as:
All the above are very easy to contact, and their websites have all the information you need. Angel Network has the largest database of investors with a highly credible database among the listed angel networks. The Angel Network is unique because it offers bridge rounds, which are internally conducted with portfolio companies, which no other angel community provides. Besides that, India’s market, money, and mentoring are unmatched.
Yet another platform that helps you find your angel investor and get in touch with them is YNOS. It provides detailed demographic information and multiple links to investors.
There is no simple way to find out who the best angel investors are in India. Start-ups, however, require investment to succeed in marketing. Professionals in the start-up world suggest start-ups must have a plan or set of steps to reach their goals.
Reaching out to them, however, can be a challenge. To ensure you get in touch efficiently with a new company, here are some steps the entrepreneur should take.
Following the above points will help you stay in touch with angel investors. Additionally, getting advice from experts will lead to successful capital investments for your business. For this reason, experts are the real game-changers in market systems.
Today, people from all walks of life are becoming angel investors and joining multiple networks to access deals and networks. Start-ups thrive early as we see investors writing checks and young techies becoming established executives. Increasingly, women, especially Bollywood actors, are becoming angel investors.
A typical angel investor in India invests anywhere from Rs 5 lakh to Rs 2 crore. A portfolio investor is advised to invest no more than 5-10 per cent in any one company.
An angel investor is an individual who provides financial support to early-stage start-up firms in exchange for ownership rights to the company. It is not without risk, though, as only a small percentage of start-ups succeed.
Although no specific academic credentials are required, an angel investor must understand the start-up ecosystem. Being part of a start-up network will help you gain better insight into market dynamics.
For aspiring angel investors, it is essential to identify the right start-ups for investments, monitor the latest market trends and developments, and gain insight into financial risk management and investment analysis before entering the realm of angel investments. Understanding startup terms, legal phrases, investor rights, and performance indicators are crucial to success.
Once an aspiring angel investor becomes familiar with the nuances, it’s just the beginning of a long, successful journey. Mentorship adds as much value to an angel investment as actual investments can.
Although angel investors often face minor setbacks, they still play a significant role in developing new businesses and can be a great source of entrepreneurship skills to youth. Additionally, angel investments create self-employment opportunities. Thus, there is a need to promote it in India.
The Hyderabad Angel Investment Network assists local entrepreneurs in their fundraising efforts for business start-ups and expansions in Hyderabad and the state of Telangana, and the global marketplace. The HA Platform enables you to introduce your business proposals to a worldwide scope of investors looking for investment ideas, ensuring your start-up launch is a success!
