How to develop an investment thesis in 3 easy steps as a beginner angel investor


Starting your angel investing journey can be both exciting and daunting as a beginner. As an angel investor, there are so many things you need to consider before making your first investment. It can get overwhelming without the right guidance and information. However, if you break it down step by step, angel investing can be a very rewarding activity, both financially and personally. The most important thing is to not invest blindly but to have a clear set of rules that you follow so you don’t get too excited or spend all your money in the first few months once you become a confident and experienced angel investor. One crucial rule of becoming a successful angel investor is the importance of crafting a thesis—a set of guiding principles that shape your investment strategy. In this article, we will show you how we teach students in 3 easy steps how to develop their investment thesis as an angel investor, which will lay the groundwork for successful and purposeful investments.

Here are the 3 easy steps:

Step 1. Identify Your Interests and Expertise

The first step in building your investment thesis is identifying your interests and areas of expertise. Consider industries or sectors where you have relevant knowledge, experience, or a genuine passion. Whether it’s technology, healthcare, consumer goods, or fintech, focusing on areas that align with your background can give you a competitive edge in evaluating investment opportunities. Additionally, think about any unique insights or networks you possess that could provide value to startups in your chosen field. By honing in on your strengths and interests, you can narrow down the universe of potential investments and focus your efforts where you can make the most impact.

Step 2. Define Your Investment Criteria

Once you’ve identified your areas of interest, it’s essential to define your investment criteria. This involves outlining the specific attributes or characteristics you’re looking for in potential startup investments. Consider factors such as stage (early-stage, seed, or Series A), business model, market size, team expertise, traction, and scalability. Additionally, think about your risk tolerance and return expectations. Are you willing to take on higher risk for the potential of greater rewards, or do you prefer more conservative investments? By clearly defining your investment criteria, you can filter out opportunities that don’t align with your objectives and focus on those that have the greatest potential to deliver returns.

Step 3. Continuously Learn and Iterate

Building a thesis as an angel investor is an iterative process that requires continuous learning and refinement. Stay informed about industry trends, market dynamics, and emerging technologies through networking, attending conferences, and reading relevant publications. Engage with other investors, entrepreneurs, and experts to gain new perspectives and insights. As you gain experience and gather feedback from your investments, be willing to adapt and refine your thesis accordingly. What works today may not work tomorrow, so staying flexible and open-minded is key to long-term success in angel investing.


Building a thesis as a beginner angel investor may seem like a daunting task, but by following these three easy steps, you can develop a strong thesis, which will lay the foundation for your successful investment journey. We believe it is smarter to make 25 £1,000 investments rather than invest £25,000 in a single startup. The primary reason being that it provides 25 learning opportunities to learn more about yourself, founders and of course evolve your thesis. 

By identifying your interests and expertise, defining your investment criteria and continuously learning and iterating, you can develop a clear and purposeful investment thesis that aligns with your personal goals and financial objectives. Remember that angel investing is as much an art as it is a science, and success often comes from a combination of intuition, experience, and diligent research. With patience, perseverance, and a well-defined thesis, you can navigate the world of startup investments with confidence and conviction.

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