You say you don't need money right now, so launch even if it's a beta and show it makes money. Investors will get interested if you can show your product makes money and you can explain how additional capital will be used to make even more money.
When angels can’t understand what your business is about
11–18 of 18 posts
Re: When angels can’t understand what your business is about
#12I've noticed this problem too. I think a lot of investors in the Valley are simply ignorant. Granted, they're busy, but many of them overplay their busyness and take a fairly myopic approach of if-I-can't-get-it-in-thirty-seconds-it-must-not-work. That's not true. Some problems worth solving are actually complex and require time to understand, somewhere between 30 seconds and an hour.
My solution has been to do as much as possible without their money.
Re: When angels can’t understand what your business is about
#13Honestly it sounds like you have a sweet idea. You should watch http://www.ted.com/talks/simon_sinek_how_great_leaders_inspi...
Re: When angels can’t understand what your business is about
#14I've noticed this problem too. I think a lot of investors in the Valley are simply ignorant. Granted, they're busy, but many of them overplay their busyness and take a fairly myopic approach of if-I-can't-get-it-in-thirty-seconds-it-must-not-work. That's not true. Some problems worth solving are actually complex and require time to understand, somewhere between 30 seconds and an hour. My solution has been to do as mu…
Active angels will typically have seen many deals, in the hundreds for people who have been doing Angel investing for more than a couple of years. I think it much more likely that an entrepreneur who is not able to get his business opportunity across in the first meeting, is probably not being very clear, or has not really figured out their business model.
Re: When angels can’t understand what your business is about
#15Framing error: You should think of it as "I'm not motivating and explaining this simply and clearly enough" instead of "investors can't understand".
Re: When angels can’t understand what your business is about
#16You may not want to hear this as its somewhat radical..what is wrong with your happy customers being your Angle VC?
Radical, huh?
Of course not all business models and cost structures can take that approach to using happy customers as Angels...
However, if you read back on early Apple INC history you will find that Mr Jobs was using credit from suppliers as seed capital/angle funds. so its not a new thing at all..
Its the same in biotechnology some of the angels turn out to be actual customers..
Re: When angels can’t understand what your business is about
#17I'm in the ibanking risk technology space, and while I've never been in your position, I'd be happy to bounce some sales ideas back and forth
my first concern would be: what do you offer over riskmetrics, that couldn't be a feature in a larger offering? most of the work in utilizing third part software is data normalization over the inputs, so you've got to have a compelling use case
e-mail me web at foobox dot com if you're interested
Re: When angels can’t understand what your business is about
#18dotBen has it about right. It sounds like your startup operates in a specialized domain, so most investors won't have the expertise to understand it - which means they likely won't invest as you've discovered (and as hard as it is to believe, it turns out you don't want them to).
The startup I co-founded struggled with exactly this issue for the same reason - the company operates in a specialized domain. Just like you, customers got it but investors didn't. After about a year of fund raising (and working with customers) we found someone with the ability, desire, and domain knowledge to invest and we got a funding commit after a 1 hour first meeting. With the help of the lead/early followers, the round filled out shortly thereafter.
If you have something valuable as measured by customer interest and, ideally, adoption, hang in there and keep looking. Try to figure our quickly who will lead a round and who won't. Unfortunately, it is hard to tell the difference until you experience the process with someone who decides to lead.