Start-ups rarely get chosen by angel investors for funding. However, a lot of Venture Capitalists (VCs) and micro-VCs are emerging specifically for idea stage start-ups in India. The Indian Angel Network (IAN) has been actively investing in promising early-stage start-ups especially in the technology space and supporting them with mentoring and market access along with money.
However, getting shortlisted by IAN requires start-up founders to be very precocious and start-up ideas to be very promising. Shortlisted start-ups can enjoy value-add by IAN and even get introduced to other investors by the latter.
Who is Indian Angel Network?
IAN is a network of angel investors in India comprising hundreds of investors across multiple countries who are primarily interested in funding early-stage start-ups. It is Asia’s largest network of Angel Investors and includes highly successful CEOs and entrepreneurs based in India and elsewhere.
Why was IAN formed?
IAN was initially formed to discover, cross-refer and link start-ups in Asian countries mainly in India and Bangladesh. IAN was also formed with a vision to create an environment conducive for venture investing in the start-up ecosystems of these regions.
The founding team of IAN
The founding team of IAN includes Padamaja Ruparel, Raman Roy and Saurabh Srivastava. Raman Roy is well known as the pioneer of the Indian BPO industry and Saurabh Srivastava is one of India’s leading entrepreneurs and investors.
Padmaja Ruparel
Padmaja Ruparel is the co-founder and President of the IAN Fund, an early-stage investment fund by the Indian Angel Network. She is recognised as an authority figure in the Indian entrepreneurial ecosystem.
Successful start-up funding and sectors covered by IAN
IAN has covered a wide variety of industry sectors including manufacturing, cyber security, ed-tech, hospitality and new-age technology like AI (Artificial Intelligence) and drone technology. Start-ups funded by IAN that made it big include high value companies like Kwench, LBB, TagBox, Propelld, FabAlley, MySpinny, Wow! Momo, Box8, Uniphore and Native Special.
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Start-ups funded by IAN that made it big include high value companies like Kwench, LBB, TagBox, Propelld, FabAlley, MySpinny, Wow! Momo, Box8, Uniphore, and Native Special.
What’s in it for me?
IAN’s portfolio is large and diverse. From Agri-Tech to Travel, they have touched every segment and they have a number of strategic investments in their kitty. They have invested in companies at different growth stages including idea and prototype stage, Early revenue, and Revenue Generating Growth. At each stage, your company needs to exhibit certain traits and characteristics to attract funding from IAN.
Idea and prototype stage companies
Idea and early-stage start-ups by first-time entrepreneurs can raise angel funding by bringing the right talent to the table. Although young companies come under the ‘high risk asset class’ for angel investors like IAN, it’s natural that only a select few idea stage start-ups will be chosen.
It is imperative that you are well prepared before meeting with the angel investor. You need to thoroughly think through the process and know the business model of your start-up like the back of your hand. For prototype stage companies, if you don’t yet have a product, you must at least have an endorsement or proposition of the product.
At the idea stage, your start-up needs to be clear on its cash rules for approaching angel investors. You need to study your target market carefully, have a strong customer acquisition and price strategy, a great team, a robust product delivery model and transparency about company expenses. Have all revenue related information in a single place. Also ensure that your pitch is well rehearsed and your pitch deck is pinpoint precise.
Early Revenue – Use case
Oliveboard, an EdTech start-up raised INR 23 Cr. in Pre-Series A fundraising led by IAN. They were funded by IAN at the early revenue stage since they have ventured into the government job preparation industry in India which is a lucrative market estimated to be worth INR 400 B. This market has strong growth drivers for two reasons:
- The closure of offline coaching centres
- The strong internet penetration in Tier 2 and 3 cities
Revenue Generating Growth – Use case
goSTOPS, a Backpacker Hostel Brand targeting the GenZ population recently raised Pre-Series A funding led by IAN. goSTOPS is currently at the revenue generation growth stage and was chosen by IAN due to their strong market standing and innovative business model. Start-ups and entrepreneurs can be funded by IAN if they have the potential to be at the forefront of a particular industry segment or market.
