Obtaining Funding Through LIAN
Before submitting your business plan for consideration, you must determine if angel capital – and specifically capital from LIAN members – is right is for your company. Please review the Before You Submit a Business Plan section.
The business plan application is designed to extract the most important details about your business to facilitate an internal review process, which will determine whether your company should: a) be invited for an initial screening presentation; b) be directed to receive help in evolving your business plan; or, c) be referred to other potential sources of assistance because your Plan is unlikely to receive funding from LIAN members.
After reviewing your business plan submission, members of the Board of Directors, acting as a screening committee, will invite you to make a brief slide presentation at a monthly board meeting to determine whether your idea may be of interest to our members. If you succeed, you will be invited to present to the full membership. You will be notified promptly of the results of your presentation to the Board.
Presentation to members
If the Screening Committee so recommends, you will be invited to present to the full membership. You will have the opportunity to elaborate on your business plan. Prepare to deliver a 10 minute investor presentation and address questions for an additional 5 – 15 minutes. You will be referred to one of Long Island’s two New York State Small Business Development Centers, the New York State Center for Advanced Technology in Biotechnology or in Sensor Systems, the New York State Center of Excellence in Wireless and Information Technology, the Advanced Energy Research and Technology Center, and/or other regional resources for assistance in preparing and rehearsing your presentation. At the presentation stage, members will decide whether they are interested in investing in your venture and wish to pursue a due diligence process with you. LIAN members’ decisions are made individually; if members do not choose to engage with the investment opportunity that you represent, their decision is final.
During due diligence, interested investors will verify the statements made in your business plan, presentation and financial projections. They will thoroughly research your team’s background and track record. If you play an active role in facilitating this process, it will help to expedite a final investment decision. While LIAN may provide administrative support for this effort if necessary, the performance of due diligence is the responsibility of those individuals who are interested in engaging with your investment opportunity.
Term sheet negotiation
After successful completion of the due diligence process, interested angel group members will present a term sheet that defines the structure of the investment deal, including type of equity and board of directors representation, using industry standard terms and provisions.
Funding and Beyond
When all parties are satisfied with the terms and language contained in the term sheet, the deal can be executed. But remember, closing the deal is only the beginning of the angel funding process. Now you have access to a network of value-added contacts and experienced professionals who can provide essential guidance for the growth and success of your venture. Adhering to the responsibilities at this stage will enable you to get the most from your angel relationship.