One way that an entrepreneur can look at the preparation for a meeting with an Angel Investor is to think about it in terms of a “first date”. You’re not going to decide at your first date whether or not you’re going to get married, whether it’s a blind date or a referral.
In approaching Angel Investors, getting a referral is better than looking on match.com, but it still is going to be as much, if not a more intense conversation as one would have going on a first date. On a first date, you might hold some things back, you might be tentative, you might not answer some questions directly. Whereas when you meet with an Angel Investor, you need to be prepared to be transparent, to be open, to demonstrate credibility about what you know and how you’re going to build your company.
So, preparing for that meeting is really a function of knowing yourself and the company you’re building very well. A lot of times, people feel like they’re prepared, but they’re not necessarily ready to answer the questions that are going to be raised. One of the things about being prepared for questions is being able to answer them or understanding that you may not yet have the answers. This actually builds your credibility as well because angel investors are not just looking for big opportunities and financial returns and all of that. They’re looking for a founder with whom they can work closely with because this is a lot like what’s going to happen after a first date. Are you going to have a second date? Are you going to start going out so that you get to know each other? In getting to know each other, do you fit well together and can you communicate with one another? Because an angel investment is the beginning of a very long term relationship.