When Will Angel Investors and Venture Capitalists Actually Invest?

Throughout the past year, I have noticed several trends while trying to raise capital. Angel investors, and venture capitalists for that matter, take forever to actually invest in your business. There were several times in my entrepreneurial career when I thought that I was guaranteed investment. I kept thinking to myself, I have a great concept, strong team and even a half way decent alpha build developed. Sadly, I still do not know exactly what it takes to grab an investor's attention enough for them to actually pull the trigger.

I have come to realize that raising even a small amount of angel funding is a challenge. When I first started, I knew it was not going to be an easy task, but I never really understood how difficult it was.

Now, I know you are probably thinking...

Something just isn't right with your approach or concept.

After having pitched to a few venture capitalists and seed accelerator executives, my partner and I were never told we had a bad concept. Most people, particularly Woody Benson from Prism VentureWorks, actually loved our idea. Our problem was that we just could not get enough programming traction behind our vision.

I still do not fully understand why my company, Oaysus, has not been able to raise capital, but I think it is just a matter of finding the right investor. Today, I spoke with Paige Rasid from the Connecticut Technology Council. She told me that there are not a lot of angel investments occurring throughout the state. This news is shocking because Connecticut just instituted a 25% tax credit for angel investments.

If an angel makes an investment of $100,000, they are entitled to receiving a $25,000 check in the mail from Uncle Sam.

Angel tax credits have been increasing throughout the country, yet investors do not seem to be taking advantage of the opportunity. If more investments were made, more companies would be starting and ultimately, more jobs would be created. The venture capital industry seems to be shrinking and as a result, they are also not as active as they once were. Venture capitalists also have a long courting process before even considering you for an investment. Is it possible that this is all a result of the recession?