Angel Investors: How to create your own?
People often ask me about angel investors in the games industry. I can usually name a dozen folks, mostly previous founders or executives in the field. However, these individuals are constantly bombarded with inbound deals and often aren’t consistently active in angel investing. While some might be full-time investors, the truth is that the games industry lacks well-known, dedicated angel investors.
In this post, I want to share a strategy for new game founders who lack a broad network but have something compelling for potential investors. I call it “creating your own angel investors.” Searching for angel investors on social media or LinkedIn won’t yield many results because people rarely advertise this role. Yet, many industry professionals are open to angel investing if given the opportunity.
From 2020 to 2023, I ran an angel syndicate with over 200 game industry professionals investing together. My approach was simple: I asked people if they were interested in investing in startups. Founders can do the same. Approach experienced people in your industry and see if they’re willing to invest in your startup. Some may only contribute a few thousand dollars, while others might offer ten thousand. The goal is to find a dozen such individuals to raise, say, a hundred thousand dollars.
Research is crucial. If you’re raising funds for a mobile free-to-play company, don’t target PC-focused investors—they might not understand your market. Instead, approach those with relevant experience and ask if they’d join your angel round with a small check.
Be prepared to pitch your company effectively. Potential investors are often busy with their day jobs and view angel investing as a side activity. They need to know what you need the money for, how you plan to use it, and what additional support you’re seeking.
Finally, consider pooling these investors into a special purpose vehicle (SPV). Providers like AngelList, Odin, and Carta can help set up an SPV where dozens of small checks are combined into one line on your company cap table. This makes signing efficient and ensures all communication goes through the SPV rather than dealing individually with each investor.
Still one more: how to increase the odds of raising from angels? Having something to show that you’ve already built something that users are using would be optimal. This means that you’ve taken founder-risk to prove things at your own expense and aren’t waiting for investors to carry all the risk.
Here are previous articles and content I’ve created regarding angel investors.
