The fashion industry has its incredible highs and with that, its incredible lows as well, so if you are looking to venture out into the fashion industry, then it is a good idea to take the help of fashion angel investors. They can make a big difference to your business. We all know that being successful in fashion is more about having the right connections and backing than talent, thats where a fashion angel investor comes in.
Why You Need Them
Now when youre starting off, you should definitely consider a fashion angel investor to invest in your business rather than a venture capital firm. Why? This is because angel investing has changed a whole lot in the last decade or so. Before the entire technology boom (and subsequent bust!), venture capital firms were approached for funding small businesses and companies. But now that has changed because venture capitalists have much more cash at their disposal and they prefer to invest in larger companies.
So angel investor groups have actually taken the place vacated by venture capitalists. They play the role of mini venture capital funds. The basic requirement for any angel investor is that they should be an accredited investor, which means that they should have liquid cash over and above the amount they have at their disposal because of their property and their little nest egg. An angel investor who is cautious and rational will invest about ten percent of the ready in your business.
In the fashion business, financing is of huge importance because, lets face it, the fashion industry, more than any other industry requires large amount of funding in its initial stages because:
A great deal of money needs to be spent on marketing.
Social dos are a must where one can network and court potential clients.
One needs to have skilled tailors and workers.
Designers should be extremely talented and from good schools.
The material for making the shoes, clothes, bags or anything should be of very good quality.
How To Grab Their Attention
None of this comes for cheap. Fashion industries require a great deal of working capital, right from their inception stage. And this capital cannot be generated by the business only. If, of course you are already a wealthy person, this should not be a problem, but if not, and this is generally the case, you should definitely look into funding options.
Before approaching fashion angel investors you should draw up a convincing plan of action a business plan so to speak. Of course you should never reveal your trade secrets, but you get the drift. More often than not, the fashion angel investor you approach will be smart enough to figure out what exactly you intend to do without you spelling it out.
Offer them a good stake in your company. You can also attract an angel investors attention through say, press releases. Why? Because they make it a point to thoroughly look through press releases of upcoming companies. Last, but not the least, remember to do loads of networking in order to court fashion angel investors.