- High growth ambitions. This is essential and not necessarily a given.
- You have an outstanding founding team of at least two people (3 also works, but not 4). Sole founders find it difficult to get investment from Business Angels (if you're a sole founder, try the FFF route).
- UK legal structure, with founders based in the UK, and with a very strong preference for Cambridge and the South East. This is primarily as I like to meet the founders face to face, during due diligence and post-investment at least once or twice per year, and that is much easier for me, if the rail journey time is under an hour.
- I will not invest, unless I get to know and trust the Investor NED who will be representing my and others' money
- I need to know that you understand, and can justify the ratio: "Customer Lifetime Value" over "Cost of Customer Acquisition". See this article for an explanation
- Evidence of a large market. Globally at least £/$100m, although not all businesses need to have global ambitions. Note that I don't need to see a billion+ market - angels can get an excellent return, even if the investee's revenues are less than £5M on exit.
- A level of defensibility, whether it is speed to market, know-how or a patent application
- I have limited life science technology knowledge, but strong experience in software, electronics, RF comms, sensing and related areas. Please look through my portfolio to get a feeling for my comfort zone
- Business model: B2B (very rarely B2B2C). Never B2C unless I already personally know the entrepreneurial team
- Deep product technology. I do not invest in web or mobile apps, nor service businesses. I will invest in a platform, provided there is a clear understanding of the costs of sourcing and supporting both sides of the platform - see CCA/CLV (see above)
- Early stage income, probably pre-revenue and pre-grant income, although evidence of valid (even if a one off trial) customer sales traction will help
- Pre-money valuation, mostly under £1m and with an upper limit of £2m (unless exceptional). Valuations have been moving upwards, due to the over-supply of early stage money (particularly in London) and NOT (yet) because exits are at a larger multiple nor more frequent
- Like most Angels, I look for a minimum 10X valuation increase within 5 to 10 years, so if you are asking for, say, a £1m post-investment valuation, what does your company look like? and who will buy it for £10+m in a few years' time?
- I will not invest through a platform that charges a fee (I want to be on the cap table with direct contact to the founders). Although i understand that everyone has to live, I am not keen on co-investing with early stage syndicates/funds that take a fee, whether for pitching and/or successful finance and/or board monitoring
- Syndicated. I never invest alone. Although I can connect and/or build a syndicate, if I like your proposition. Angels (although rarely those who invest through online platforms) want and expect to add value with connections, advice, governance and future funding. I do not invest in deals that either have been, or are, on any equity crowd-funding sites except Syndicate Room