Are sites like AngelSoft and The Funded a good resource for finding Angel (and other) investors?

Sites like AngelSoft and TheFunded are potentially valuable resources, but with caveats.

First off, investor introductions that are facilitated via a website will rarely be as effective as introductions that come directly via your own network, such as past co-workers, past managers, friends, etc. (Perhaps see the earlier posting titled “What is the best way to get in front of an Angel investor.)

One advantage of AngelSoft is that it helps entrepreneurs format their executive summary into a form that is familiar to investors. But without some offline networking to compliment an AngelSoft submission, I personally suspect success rates are low. And as one data point, the Band of Angels (where I am a member) does not access AngelSoft submissions because our preference is deals that come to us directly via our members’ own networks. On the other hands, some of the primary Silicon Valley angel groups do use AngelSoft extensively. I do not have a sense for the rest of the USA.

I’d recommend spending time at the website of the Angel Capital Association (http://www.angelcapitalassociation.org). There you can find the legitimate, active Angel investor groups in your own region. From there, you should take a look at the portfolios of the various groups, to see if they have an appetite for businesses like your own. Likewise, you might want to avoid approaching groups that already have a directly competitive company in their portfolio, not because they will in some way steal away secrets, but more so because they tend not to want to be too concentrated in any one area.