Angel Investors & Artists: What are you cooking?

 

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So my husband is a bit of a foodie, and he loves to cook. (Did I win the husband jackpot or what?) I asked him, how do you decide what pot to use when you are cooking? His answer: It depends on what you’re cooking.

Yes, given the title of this blog post, I’m about to create a metaphor for artists seeking angel investors using pots and kettles. You, the artist, are an entrepreneur. It is time to start thinking of yourself that way, because calling yourself a delicate teapot is significantly different from being a black kettle. For one, a teapot could never do the heavy work a black kettle does. When an angel investor evaluates you and your idea for funding, he is  going to test your mettle. You need to be tough enough to do your job, and able to withstand a long and heated journey. And secondly, perhaps a delicate teapot does not need an angel investor. Delicate teapots tend to come from money.

Creative entrepreneurs need money. It takes time, resources, and even technology to create a body of work. And before you think I’m finished with my metaphor, I’d like to point out that when an angel is looking to invest in a creative entrepreneur, he will be looking for an idea that has both scope and scale. In other words, angel investments depend on what you’re cooking. The lone artist trying to get funding to paint a mural on a dilapidated  building is not likely going to find an angel investor. There isn’t any return on investment in small ideas. The pot is only half-full. However, a lone artist who has a vision to paint ten murals on a selection of inner city buildings, while teaching neighborhood kids how to paint just might attract an angel for their project. This is a pot full of possibility, able to feed many people. And before you think this stands in the realm of non-profit funding, think about how much exposure is created by that kind of project! A creative entrepreneur can solidify their standing as an artist, build up their personal brand, and sell more artwork in the future. That doesn’t mean your ideas always have to be grand, but they do have to offer a way for the angel investor to profit from their investment.

Angel investors evaluate and consider many other aspects of your business idea. As you have agreed to call yourself an entrepreneur from here on out (or you must stop reading…), you must consider the professional framework angel investors often use for evaluating an investment opportunity. The Harvard Framework takes in to consideration four aspects of an endeavor: the people, the deal, the business opportunity and the context of the endeavor in world at large.

So, when your black kettle is cooking with a great idea, there are a few questions to ask yourself.

Who is on your team? Include yourself in this evaluation, since you must bear the weight of the proposed project. Consider your stakeholders and who will support you in your endeavor.

What are you offering your angel investor? Consider the price and structure of the deal.

What is the opportunity created by cooking this idea? Consider timing, the customer, scope and scalability of the idea, and the business model you will use.

And finally,  is the world ready for your idea? Consider your great idea in the context of the world at large. Think economy, technology, regulations, competition, customer need.

Some angel investors only look for creative projects. They are looking for your kind of black kettle, and if you’re good at combining quality ingredients, then an angel investor might just like what you’re cooking!

This post was inspired by the book Winning Angels: The 7 Fundamentals of Early Stage Investing by David Amis & Howard Stevenson.

 

 

6 thoughts on “Angel Investors & Artists: What are you cooking?

  1. Joy,
    Great analogy with the many different pots and the approach to cooking up business ideas by blending all of the necessary aspects of a successful business….and choosing the right pot to cook. The people, state of economy, and most importantly idea (product or service) will all help attract the right investors, if viable. This also holds true for donors choosing which nonprofit program they want to fund. In researching my business model for the ME program, I feel compelled to do as much research as possible to make sure there’s a demand. Your right, investors want to know the business idea will be large enough to earn them some cash and we need to feel comfortable convincing them it’s a great idea and that the market is right.

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  2. Excellent post Joy! I love how you used the metaphor of the different kinds of pots/kettles. You took a challenging topic and made it easy to relate to. It made me think of that book 212Degrees. The premise of that book was that at 211 degrees water is hot, but at 212 it boils. It is often that extra push from an investor that takes a business and give it steam. As with every business and ever type of pot, there are different factors that go into reaching desired outcomes and a good fit for all parties involved. This part of the process can really make or break a deal.

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  3. Great job Joy! Your ability to write creatively makes your post fun to read. I appreciate the analogy to cooking! You highlighted that an angel investor is not always needed for business endeavors, and I think that it important to know. With your takeaways, the reader now understands how an investor may evaluate their product, service, or company. What is more important is that the process will allow the creator to evaluate if an investor is needed. The example of how a small mural project can take on a few adjustments to be something on a larger scale and be appealing to investors was a great example for readers like myself. I like it because people have small personal projects or things they are passionate about all the time. Your example shows how those small passions can transform into realities, sometimes beyond the initial dream, if the reader is willing to be just a little more strategic in approach.

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  4. You are a lucky woman for sure. I love food with a burning passion. The kettle metaphor is a fantastic one. I agree, you want your business venture to have scope and scale when you are looking for that capital. We are continuously thinking about how we can grow our boutique, right now it is in little ways, but I hope that in the future we can be cooking up some much bigger ideas that will allow us to grow and expand! Funny that you would mention murals…the Town of Sylva got a $10k grant and an artist was chosen to paint a beautiful mural on the side of the building diagonal from us, pretty cool I would say. It was just recently completed and is a great addition to our growing downtown area.

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  5. Hi Joy,

    The metaphor that you used ensures that your readers who may not have experience as an entrepreneur have a general understanding of your message. I like the way that you stated that your idea doesn’t have to be grand but creating the right opportunities to get your personal brand out in the public may create future opportunities for increased revenue. Now let’s hope that we find an investors that prefers our style of cooking!

    Ashley

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