What Are The Critical Components Necessary When Attempting To Attract An Angel Investor To Your Biopharmaceutical Startup?

A | SOLICITING ANGEL INVESTORS - OR FRIENDS AND FAMILY - CAN BE A USEFUL WAY TO LAUNCH COMPANIES. However, since they aren’t typical life science investors, certain considerations come into play:

1. Make sure the investors are aware of the risks of early-stage investing. Traditional VCs have dozens of companies in their portfolio and fully expect some failure; angel investors don’t usually have that type of diversification.
2. Make sure the angel investors keep capital in reserve. Most likely the company will need more capital than it originally thought.
3. Keep the angel investors well informed. Make sure they hear about the challenges as well as the successes along the way. The goal should be no surprises.
4. Put seasoned life science executives on the board. They will provide the judgment and mentorship capabilities that an angel investor can’t.

DENNIS PURCELL, a founder and senior advisor of Aisling Capital, has completed over 200 transactions and supervised over $15 billion in life sciences industry financing and advisory assignments.