Angel vs Venture Capital funding – which suits you best?
by Startacus Admin
Ofri Ben-Porat is CEO and co-founder of mar-tech startup Pixoneye – an advanced computer vision and AI technology delivered on device that offers in app content personalisation for brands. Here, Ofi writes for Startacus on the measured approach Pixoneye took when looking at Angel or VC funding.
"I think I can safely assume that everyone visiting Startacus will be involved in at least one startup, and as co-founder and CEO of one, Pixoneye, I thought it might be useful to share my insight into what we’re surely all searching and wishing for – funding! But it’s not always as simple as we’d like it to be. Let’s face it, it’s not every day someone comes along and offers us a shiny bag of coins.
Yet too often I’ve seen startups accept the wrong type of funding, often hindering or causing irreparable damage to its long-term prospects. So which type of investment suits you best?
Angel investors invest based on emotion. They’re looking for passion projects, and want to be as excited about your business as you are. They want to trust your team and product. The ideal angel investor behaves like a mentor. They can advise you, introduce you to their contacts and give their own insight about your industry. It’s not just a financial investment – you’re tapping into their expert knowledge.
On the other hand, Venture Capital funders have to invest on behalf of clients – and deal with all the pressure that comes with. While they’re putting faith in your product or service, there is far bigger burden to scale and return on investment as soon as possible.
For startups like ours which can’t survive on a bootstrap budget, funding needs to be very considered. It often works best with a close collaborative relationship, with investors aligning to the same vision and idea of outcome.
When we got to a great stage of our journey, with two offices, three rounds of funding, a fully functioning product and R&D team, we were expected to go for VC funding. However, we decided to continue with angel investors as we felt they’d have patience with more realistic expectations as to when they’d see returns. We also really feel we part of each other’s success; not just another company in a wide portfolio.
If you’re ready for rapid expansion, you have your product and message nailed, and are ready to scale, perhaps VCs are the best option for you. You’ll more likely see the deeper pockets you need. However, don’t chase this from the beginning. Do your research to find which angel investors can provide you the best mentorship, while allowing you to give your business the attention and patience it needs to grow and flourish."
Ofri Ben-Porat is CEO and co-founder of mar-tech startup Pixoneye – an advanced computer vision and AI technology delivered on device that offers in app content personalisation for brands. Ofri also consults for Waze and served as senior marketing advisor to the minister of tourism in Israel prior to launching the company. Pixoneye has recently been shortlisted for start-up of the year for the 2017 BIMA Awards and has been featured in Marketing Week’s 100 most disruptive brands list.
Subscribe to our newsletter
If you would like to receive our startup themed newsletter, full of the latest startup opportunities, events, news, stories, tips and advice, then sign up here.
Starting a business can be a lot of hard work, so here's a few ways to avoid burnout and find a healthy work life balance.
At one-day event Ideation NI Thon, students will get the chance to solve global and local sustainability, environmental, city and health problems.
NI startup ESTHER, a peer-2-peer giving platform allowing charitable donors to give money directly to people living in poverty, head to New York for a 4-day fact finding mission.
The lowdown on how an Australian startup generated global sales for their innovative product, "weighted blankets"...
At 82% the UK takes 4th place in the list of countries being most ready for automation and robotics, whilst 30% of UK population’s jobs are at risk of automation.
The innovative game, eQuoo that helps users build their emotional fitness and thereby help fight their mental illness
The London-based femtech startup that is using AI and genetic testing to provide a tailored oral contraception service for women
Recent research by Starling bank shows that in 2019, women earned up to £12,319 less per year than their male colleagues of the same age and within the same industry
Brandtech group, You & Mr Jones, has invested in ethical video startup Good-Loop who have closed a US $1.6m seed funding round.
2019 saw celebrities contribute to start-up investments in record numbers, surpassing a previous spike in 2015.
Published on: 16th August 2017
.png)
If you would like to enable commenting via your Startacus account, please enable Disqus functionality in your Account Settings.
- Ideation NI Thon at NI Science Festival sets out to solve global issues 17th Jan 2020 At one-day event Ideation NI Thon, students will get the chance to solve global and local sustainability, environmental, city and health problems.
- NI startup ESTHER takes flight to New York 16th Jan 2020 NI startup ESTHER, a peer-2-peer giving platform allowing charitable donors to give money directly to people living in poverty, head to New York for a 4-day fact finding mission.
- 2019 stats show that the gender pay gap continues 14th Jan 2020 Recent research by Starling bank shows that in 2019, women earned up to £12,319 less per year than their male colleagues of the same age and within the same industry
- Digital DNA Awards 2020 nominations now open 13th Jan 2020 The Digital DNA Awards, held in partnership with MCS Group, celebrate the best tech talent, from companies of all sizes, excelling in the world of Digital and Tech and not just in NI...
