Month 2 of 6 · Roadmap to Investing Lesson · 1 of 6

Lesson

Quiz

Lesson two

Deal sourcing & screening

Two skills sit at the start of every angel investment: finding opportunities, and deciding which are worth backing. This month covers both, from where deals come from to a disciplined way to assess them.

First the lesson: sourcing, then screening. Then a five-question quiz to check what you’ve taken in. The bar above tracks both.

Sourcing

Where do opportunities come from?

Deal sourcing is the process of identifying investment opportunities. It happens in many ways, and no single route is the correct one. The key is to be intentional and build access to deals that fit your investment thesis.

The thesis you started in Month 1 does the work here. The clearer you are about what you want to back and why, the easier it becomes to know where to look and which opportunities to let pass.

What do I have access to, and does it fit my thesis?

Sourcing

Eight routes. One covers most of them.

There are eight common ways angels find deals. You can build all of them yourself over time, or join a syndicate that already brings most of them together.

The route that bundles the rest

Angel networks and syndicates

A syndicate hands you a filtered pipeline of curated pitches, written deal memos and shared due diligence, alongside experienced angels who co-invest and pressure-test each other’s thinking. You start from deals that have already passed a first screen, and learn from every opportunity the group sees.

This is how angel syndicates like The GIN and Diversity-X Ventures work: one place to see deals, assess them with others, and invest alongside people doing the same.

A syndicate already folds in

Founder referrals

The network’s collective reach surfaces warm introductions you would not see alone.

Accelerators and demo days

Syndicates plug into these pipelines, so you get the shortlist without attending every event.

Other angels

You invest alongside them by default, and see how they read the same deal.

Sector communities

Members bring deep sector knowledge, so specialist deal flow comes to you.

Shared due diligence

The work of assessing a deal is split across the group, not carried by you alone.

Structured learning

Every deal the syndicate reviews sharpens your judgement for the next one.

What you can still do alongside

Direct founder outreach

Reach out to founders you find interesting and build the relationship early.

Your own network

Colleagues, advisors and operators all meet early-stage companies. Tell them your thesis.

Online platforms

Broad access, sometimes lower minimums. More access is not better opportunities.

Screening

How to screen what you find

At angel stage there is rarely a perfect answer. Companies are young, information is limited, and the numbers may be early or still evolving. A structured framework does not replace judgement or experience. It gives you a disciplined way to compare companies consistently and avoid being swayed by a polished pitch, a charismatic founder or market hype.

I would rather see a simple product solving a real problem than a sophisticated product looking for a market.

The next panel sets out eight things to look at when reviewing an early-stage startup.

Screening

An eight-point framework

Product-problem fit

Is the company solving a real, painful, important problem?

How painful is the problem, and how often does it occur?
Is there evidence customers care?
What makes this better than what exists?

Market potential

Is the market large, growing or underserved enough to scale?

How big is the addressable market?
Is it growing or being disrupted?
Can this company capture a meaningful share?

Timing

Why is now the right moment for this solution?

What has changed in the market?
Are there regulatory or technological tailwinds?
Have similar ideas failed before, and why?

Unit economics

Can the business make money as it grows?

What does it cost to acquire and serve a customer?
What is that customer’s lifetime value?
Do the economics improve with scale?

Scalability

Can it grow without costs rising at the same pace?

Where are the operational bottlenecks?
Does growth rely heavily on hiring?
What would need to be true to grow 10x?

Defensibility

What protects its position once it works?

Proprietary technology, data or IP?
Network effects or high switching costs?
Is distribution or brand distinctive?

Exit potential

Who might eventually buy the company, and why?

What are the likely exit routes?
Are there comparable exits in the sector?
What milestones raise exit potential?

Management team

Often the most important factor at this stage.

Why is this the right team for this problem?
Are they committed, with complementary skills?
How do they handle challenge and setbacks?

Screening

Applying the framework

Not every criterion carries the same weight at every stage. The framework is a way to structure your thinking, not a rigid scoring tool.

Very early stage

Quality and commitment of the team
Strength of the problem
Timing of the opportunity
Early customer validation

Later stage

Unit economics
Scalability
Revenue traction
Competitive positioning
Exit potential