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How do I work with Angel Investors?

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Your first move: Meticulously inspect your business plan before any meeting with an angel investor. Know it back and forth. Be specific and realistic, and be ready to answer tough questions such as:

What will it take to get to profitable?
What skills are you lacking and how will you build a team to overcome those hurdles?
How do your personal finances relate to those of the business? (Investors want to know that you're willing to sacrifice to make the venture succeed and make them a lot of money.)

Crunch the numbers and scrutinize your cash flow so you understand exactly how much money you?ll need and when. (Hint: Allow for about six to 12 months to close a round of venture capital.) Then, schedule a meeting with the potential investor.
There are two main goals for your meeting: Share your vision for the business, and achieve a verbal or written nonbinding investment agreement. Consider bringing a business plan summary to the first meeting rather than the full plan so you don?t get weighed down with details. Most angel investors will trust you to work out the kinks. They want to see that you?ve done your homework and have a realistic picture of the market. Leaving your full plan behind also creates an opportunity to follow up with the investor after the encounter to schedule a second, more thorough discussion.
The ideal time to ask for angel funding is when you?ve had at least two or three social interactions with the person and the relationship feels established and comfortable. Make sure the individual is at least curious before popping the question.
Start with a handshake along with the goal of proceeding to a letter of intent and then a legally binding agreement. Shoot to agree on a range, such as $50,000 to $75,000, and then follow up promptly with the paperwork. Letters of intent may also help you attract other angel investors. If you do not reach an agreement, schedule a meeting in the future to revisit the idea.

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