India is among those top countries that have a flourishing startup ecosystem in the world. With almost 50,000+ startups and 3,500+ funded startups escalating rapidly at more than a 30% rate, the Indian startup system is contributing a lot to the country’s economy.

Startups require funding and many Angel investors support them. But for a startup that is seeking investment, getting a lead investor is extensively important. It is like a magic key that would not only lead to successful funding but will also shape up the company in the initial stage. In short, the success of a startup often depends on the right lead investor.

Who is a Lead Investor?
A Lead Investor is an investor who willingly steps in and represents the investors of a startup before, during, and even after a fundraise. By understanding the nuances of angel investing, the lead investor can bring strategic as well as business value to the startup and contribute passionately towards its growth.

Establish credibility in the market –
Many startups at the mere onset often don’t possess the exact marketable product or service sought by the customers. Unless the founders are famous or well-known, it becomes very difficult for the startup to not only bag funding but also to convince others about being the next unicorn and establish credibility. Here’s where the lead investor takes over. The reputation of the lead investor established the credibility of the company as well attracts other investors to contribute to the funding. A right lead investor pushes other investors who were interested but were doubtful about taking the risk.

Major first investment –
The major first investment depending on the funding size and the number of investors is done by the lead investor.

Give advice –
The lead investors have a lot of experience and insights. While they have seen many successful cases, they have also seen failed ones and they know the industry, the market better than the founder. The lead investor guides and advises the founders as a board member for the betterment of the startup and how to raise more funding.

Negotiate terms –
In order to protect the lead investor’s interest and get better returns, the lead investor acts as a mentor, even a business partner, and negotiates terms and policies with co-investors and others to protect the start-up.

Enhanced marketing point –

From introducing potential investors, hiring a law firm to handle the paperwork to making an introduction to new connections, and structuring future fundraising rounds, a lead investor acts as a great marketing point.

These are some of the attributes of a lead investor. Lead investors are generally super interested in your startup and lead the project and lead with passion!

If you are looking for such a lead investor then we at Hyderabad Angels have many who have acted as lead investors and successfully funded and exited several startups!