I need some basic guidelines what one needs to consider when choosing : 1) How to decide the angel investor who wants to invest in you is the right investor, because I might be deal with them everyday. 2) Once I do have the funding what are the usual things I need to consider. Trying to understand how the funding should be alloted. Does the angel investor tell me where I should invest to pivot my innovation (because its his cash) or do I need to make those decisions. 3) What do most entrepreneurs do when they receive funding from an angel investor? FYI : I'm in the R&D industry and do have a working product.
First, make sure you have a good lawyer who has a lot of experience in early stage deals. Glad to recommend some for you if it's helpful. In terms of your questions:
1. If you don't know the investor well, check references, ideally with entrepreneurs they have funded. Meet the investor several times to ensure that you'd want to spend time with them in the future.
2. The angel investor can provide guidance, but as the CEO/founder, it is up to you to drive the company, figure out what needs to be done, and do it. The investor provides capital, and you runs the company.
3. Most entrepreneurs take the funding, work on their startup for a few years, and then go bankrupt. If you don't have a sense of how to make the company successful, surround yourself with experienced people and do everything in your power to figure out how to be successful, the byproduct being that you will have given your investor a nice return.