Peter Cowley and Paul AnsonAngels, Dragons (or Comedians)?

Peter Cowley and Paul Anson

Topics

• Pitching to Angels

• How the investment environment is changing

• Personal experiences

• Other sources of funding

• Martlet

• Pizza time

Pitching to Angels

Peter CowleyCambridge AngelMentor/investor/charity chair

Format of event• Audience/location size?

• PPT allowed?

• Hand-outs allowed?

• Gadgets/widgets to pass around

• Pitch length and Q&A length

• Which team members are on the “stage” and how many speak?

• Dress, sitting/standingPeter Cowley

What angels want to see (or not)

• Be genuinely enthusiastic/passionate!

• Need to build trust

• Need to believe that team can deliver

• Angels soon put off by stated facts that they know (or suspect) to be wrong

• Avoid management speak

• Avoid “slick” salesman approachPeter Cowley

Must have topics – part 1

• Core business “sound bite” 20-30 words

• Market being addressed

• Confidence that either market will grow or company can grow into the market

• Where you’re at right now – market research, technology, sales/grants

Peter Cowley

Must have topics – part 2

• What you will use the money for

• That you are not a one “product/service” company

• Team

• Monetisation opportunity

• Investor exit route and forecast return multiple (10x?)

Peter Cowley

May have topics

• Competition

• Defensibility? Patents/copyright etc

• Market justification

• SWOT slide

• Existing shareholding

• Existing IP

• Deeper description of technology/servicePeter Cowley

PPT guidelines

• Depends of time allotted

• Say max one slide per minute, 30 point font?

• Use images, drawings etc

• Must avoid too many words – 4 to 8 lines of 10 or so words

• Graphs of market growth, sales, cash flow etc

• Can embed videosPeter Cowley

Ending

• Essential that there is a very concise overview with the “ask” - £xxxK cash (possibly saying at a pre-money valuation of £xxxK).

• Ask for questions (if format allows)

• If possible, ask who is interested in following it up.

Peter Cowley

Q&A• Listen to the question!

• Decide which team member is answering what

• Make sure all team members speak

• Do not lie! Say “you don’t know and will check”

• Avoid bull-shitting

• Take control if questioning is going off at a tangent – you haven’t got long and the tangent may be of no interest to others

Peter Cowley

What is happening?• BBAA 2009/10 figures suggest membership stable (around

5000, perhaps 20% of market) but only 10-15% active.

• Applications increased, proportion presented decreased.

• 2.5% of all applications (9640) successful (down from 2.7%)

• Number of investments increased 8%

• Value of Angel investment dropped 12.6%

• Overall investment value did not change

The feeling is that not much changed but there is increased competition and reduced availability due to lack of exits.

Paul Anson

Personal Experiences• VC funding is less available to pre-revenue businesses &

sector critical – e.g cleantech

• Some large angel deals –groups are syndicating and co-investing with VCs. Are Angels plugging the gap?

• Experience suggests many angels are looking after current investments, but new angels are appearing

• The angel networks are busy so are screening more

• There continues to be an appetite for early stage investing, seeding a business and providing support

• Good quality deals are getting investment, but take advantage of all sources of income.Paul Anson

Other sources of income• Friends and family

• Bootstrapping

• Grants

• Loans

• R&D tax credits

• Business accelerators

• Corporate venturing

• Sales!

Ventures that demonstrate funding ‘initiative’ are more likely to be successful.

Paul Anson

• Co-invests with other angels

• Equity cash from £1bn engineering company

• Possibility of synergy

• Any sector

• Cambridge centric

• £250K this year rising to £500K+ from 2012

• Done deals: Neul, Psychology Online

• Close: Pasmarine, Isotera

• www.martlet.org.ukPeter Cowley

Questions, please!

• mail@petercowley.org

• mail@paulanson.com

• www.linkedin.com/in/plcowley & @plcowley

Peter Cowley