Business Angels Online

The popularity of Dragon’s Den has been one of the inspirations behind the launch of new online funding service Angels Den, according to its managing director Bill Morrow.

Very simply Angels Den connects UK business angels with entrepreneurs seeking investment. It aims to help fill the sub-£500,000 funding gap for early stage businesses. It also hopes to stimulate investment from new sources. As Bill Morrow said when I talked to him last week:

“We’re aiming to attract angels who might not already think of themselves as angels. There are plenty of people in the city, for example, who’d find an angel investment a rewarding and entertaining thing to do with their money. We’ll also allow angels to club together on an investment.”

Entrepreneurs wanting to find an angel submit their short proposals through the site for £99. If their proposals catch the eye of the business analysts behind the scenes at Angels Den, then they’ll be invited to submit full proposals and will need to cough up a further £400 to get it in front of investors. If they fall at the first hurdle entrepreneurs will receive some generic advice on where their idea needs strengthening.

Although as a business you could end up spending £499 and get nothing but rejection and some general pointers, it remains a potentially cheap way of reaching angels compared to routes via traditional intermediaries and matching services. The world of cost-effective online dating meets start-up funding, if you like.

Morrow admits, however, that only around 1 in 8 initial proposals will be recommended for the next stage. Furthermore once the site has put you in touch with a potential funder and steps out of the equation, there is no guarantee of a successful outcome. Think carefully, therefore, about the strength of your business idea, plan and investment potential before rushing to join the service.

angel funding, business angels, investment, SME, SMB, entrepreneur

Alex is the founder and editor of SmallBizPod, the UK's first podcast dedicated to small business, start-ups and entrepreneurship. Alex writes about topical small business issues, entrepreneurs and anything else that catches his eye here on the small business blog. http://www.smallbizpod.co.uk