An entrepreneur should ask a bunch of questions to a potential investor and the ones that I get most frequently are:
Why are you interested in my company?
How do you think that you can help me other than your check?
I think that those are really valid questions because the best fit between an entrepreneur and an angel investor is when the check is only part of the value that they deliver to the entrepreneur. And, to a certain extent, I know that many entrepreneurs think that it’s hard to raise money but if you’ve got a company that’s going gangbusters and really successful, you’re going to have all of the access to capital that you need. People are really going to be wanting to invest in your company.
So what you do then is you’re saying, ‘okay, well I have a market for people that want to give me money.’ And, I can tell you from the angel investor side or from the venture capital side, they see it as way too much money chasing way too few companies.
What they’re going to say is, ‘Hey! In addition to the check that I write- which I know that you can get from someone else- I’ve got this network of people. I’ve got this industry expertise. I’ve got this management expertise. You know, I’ve got this piece of advice. I’ve got this experience that I can share with you to help you take that idea and turn it into a successful company.’