An angel investor is actually a Chatur investor with an invisibility cloak!
Author : Senior Writer at Chatur Ideas
Posted : 4 years ago
  • Angel Investor, Angel, investor, Chatur, startups, Shadow, funding

So who is an Angel Investor? Let us tell you who he is not! He is definitely not an investor who has a divine spirit with immeasurable wealth ready to invest in someone who drives his business like a Sunday driver. An Angel investor unlike as the title suggests is actually a Chatur investor.

In comparison with international countries, in India only one-fourth of angel-funded businesses reach a point where they receive their series A funding which makes Angel investment scenario in our country more precarious and risky.

Although the recent successes like Ola Cabs, Flipkart, In Mobi in regards to its scale and valuation has created a positive sentiment for investment. However, as Rajan Anandan MD of Google, India says, “Investments are just the first day of a Test match,” reaffirming us that although, Angel Investment ecosystem is getting greatly augmented but investing in Indian startups will always be a tricky scenario. India has a very volatile market for Startups and to make investors feel safe and secure is not easy, hence making the process of cracking an angel funding more of a herculean task. 

Here are few reasons why an Angel investor may not invest in your start up.

Validation of success

‘A gambler never puts his money on the losing horse!’ similarly an angel investor will never invest his or her money into startup which does not validate possible success. If your business does not provide proof of your potential success, no investor will put his or her hard earned money into it, period! You will have to show them in tangible ways that your business is worth to secure their investment.

Assessing the value of your startup

As the word suggests ‘Startup’ that means your company has no history of financial data to assess the valuation of your startup. You will have to find out how much direct or indirect competitors are worth to assess your own company value. Secondly, if your startup is a new age tech business or a hugely scalable business than consult your accountants and lawyers to advise you the right way to evaluate your startup valuation. If an angel investor feels that your startup valuation is not correct, they may just look for another startup to invest in.

Go hand in hand with technology

You have developed a groundbreaking business idea that would revolutionize the section of the business you're targeting, but if you don’t walk hand in hand with technology no investor will be interested in funding your business.  If your startup is not capable of moving as fast as technology, the risk of another competitor overtaking your business is inevitable. So ask yourself, will you invest into something which you know in future will not hold any value?

Have a clear marketing strategy

You have now made an unique product which will defy the cliché forever, but you haven't given the same effort to make the product sellable and have serious lack of planning to boost sales and generate the desired revenue. This mistake can cost your startup immensely, no investor will feel secured about the investment and will eventually exit. So before you arrive at the doorstep of an angel investor make sure that you know what your marketing goals are and define a concrete marketing strategy for the same.

Always remember there can be more reasons than what's mentioned above to why an angel investor can decline to invest in your startup, the most imperative thing is to not be oblivious of the obvious, keep yourself in their shoes and accept the flaws or weaknesses your startup might have, assess it and work hard to correct them. 

If you too have entrepreneurial dreams, you need to have faith in your Chatur Idea. You will always wonder who will fund this idea and from where will you find investors. In that case, you can participate in the #BeAChatur Contest and not only be mentored, but also stand a chance to win a whopping Rs.10 Lac funding for your dream startup idea.