Angel Financing--Finding Money (Part IV)

Rule 4: Use service providers to find angels.

Often businesses fail in using service providers—they succumb to the provider’s siren song of how they will get you to the gold or how your failure to use them will doom you to poverty. Or entrepreneurs will determine service providers are unnecessary evils to be avoided at all costs literally. Either approach usually ends with no money being raised.

There is a better way to use accountants, lawyers, financial advisers and others to help you find angels. Angels often rely on trusted advisors for deal flow. You need to:

• Gather a list of the top 10 to 20 advisors in each category—accountants, attorneys, financial advisers/planners who work with high net worth individuals.
• Compile these lists by talking to the local VCs, the business editors/reporters, the presidents of the local business clubs, personal and business bankers and the most successful local business people you know and admire.
• You are looking for the right people with the right connections. Avoid random meetings with professional advisers at useless networking meetings; go meet those professional advisers most likely to know the folks with money who may invest. Recommendations from advisers and other trusted sources are extremely important to many angels.