ENTREPRENEURS - INVESTMENT PROCESS
The following is a brief summary of the New York Angels investment process:
- Self assessment. Before submitting your business plan for our consideration, you must determine if angel capital - and specifically capital from our group - is right for your company. The angel investment checklist will be helpful to guide you through this process.
- Apply online via NewYorkAngels.com or Gust.com. Complete one page executive summary outlining the key characteristics of your company. A team of industry experts will review the application and determine if it is a good fit for our group. If it is deemed a good fit, then you will be invited for an initial screening presentation. It is always preferable to have a member of the New York Angels sponsor your company to attend screening. A list of members can be found under the members section.
- Screening meeting. Screening is held once a month and will consist of a 15 minute presentation to approximately 10 members. If there is interest at screening, then discovery and due diligence will begin immediately. A member will contact you and proceed to Discovery.
- Discovery. Discovery is a one hour meeting where a more in depth discussion will occur on the key issues affecting the future success of your business. No additional preparation is necessary for Discovery. If there is sufficient interest following Discovery, then Due Diligence will commence.
- Due diligence. During due diligence, interested investors will verify the statements made in your business plan, presentation, and financial projections. They will thoroughly research your team's background and track record. An initial discussion of valuation and terms will happen early in due diligence to make sure the two parties are within working distance of each other and that due diligence can proceed. If you play an active role in facilitating this process, it will help to expedite a final investment decision.
- Term sheet negotiation. After successful completion of the due diligence process, interested angel group members will present a term sheet that defines the structure of the investment deal - including type of equity and board of directors representation, using industry standard terms and provisions.
- Breakfast Presentation to membership. Once an agreed to term sheet is completed, a 20 minute presentation will be made to the entire membership. There may be an additional one hour meeting to review the deal with any new prospective investors.
- Funding & Beyond. When all parties are satisfied with the terms and language contained in the term sheet, the deal can be executed. But remember, closing the deal is only the beginning of the angel funding process. Now you have access to a network of value-added contacts and experienced professionals who can provide essential guidance for the growth and success of your venture. Adhering to the responsibilities at this stage will enable you to get the most from your angel relationship.