Is Having Angel Investors an Advantage For Early-Stage Founders?

Credit: Austin Distel

The angel investing scene in India has undergone a massive transformation over the past decade as entrepreneurs turned angels have invested back heavily in the Indian ecosystem buoyed by their exits. From less than 50 angel investors a decade ago, the Indian start-up ecosystem has recorded angel investments from more than 2,000+ angel investors (DataLabs by Inc42). The Indian angel community counts serial entrepreneurs like Sachin Bansal, Kunal Bahl, Kunal Shah as well as corporate honchos such as Rajan Anadan and Mohandas Pai amongst its esteemed list.

Beyond just offering cash, angel investors add a host of other values to early-stage start-ups — their ability to validate the business model, offer advice on blitzscaling the start-up and connect with the first batch of customers are an invaluable asset for any early stage founder. Against such a backdrop, it is imperative for any founder to gauge the value-add that an Angel brings to their start-up as well as the track record of the prospective angels he/she would like to bring on-board. While qualitative value-add is subjective and will depend on founder-investor relationship, we have tried to provide a deeper understanding of their track record over the past 10 years throughout this article.

Our analysis, particularly, sheds light on the following aspects of Angel Investing in India:

Below is a sample of 26 investors (10 Highly Active Angels and 16 other Angels) based on their investment activity:

Source: Tracxn

In total, across the aforementioned 26 investors, we looked at 608 unique investments in early-stage start-ups. Out of these 608 investments, 92 of them went on to raise Series C funding, as per the data gathered by Tracxn. However, we were only able to gather valuation numbers for 41 of those.

Our empirical study revealed:

Source: Tracxn

Δ(#Investments)=#Investments 2015–2019- #Investments 2010–2014
Δ(Hit Rate)=Hit Rate 2015–2019-Hit Rate (2010–2014)

The above chart highlights that there is no statistical evidence of improvement in investing performance. Between Time Period 2 (2015–2019) and Time Period 1 (2010–2014), even as Highly Active Angels made higher number of investments, the hit rates of 5 of them went up while for the other 5, it went down. A number of factors can explain this phenomenon:

So, what does this mean for an early-stage founder just starting out?

Starting-up has often been equated to going on a war against the status-quo. While nothing guarantees victory in a war, it always helps to have the best lieutenants on your side!

Written and edited by Siddharth Prabhu (@Sidharth_Prabhu).

Eximius Ventures is a micro venture capital fund investing in young and dynamic Indian Entrepreneurs with a precedence for female founders. You can reach out to us at



Micro venture fund investing in young and dynamic Indian entrepreneurs with a precedence for female founders.

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Eximius Ventures

Micro venture fund investing in young and dynamic Indian entrepreneurs with a precedence for female founders.