- • At Pitchstreet.com you will find Angel Investor’s from the United States, Canada, Europe and across the (7) continents. Pitchstreet.com has the largest Angel Investors Network online. Angel Investors are individuals who provides capital for a business or businesses start-ups, usually in exchange for convertible debt or ownership equity. Raise business capital, get funded!
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- • Angel investors usually give support to start-ups at the initial moments and when most investors are not prepared to back them. An angel investor (also known as a private investor, seed investor or angel funder) is a high-net-worth individual who provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company.
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- • How does an angel investor make money?
- Angel investors make money by backing very early-stage startups they find promising, with investments typically ranging from $5,000 to $150,000. In exchange, they receive an ownership stake in the company and expect returns if the company succeeds.
- • The big advantage is that financing from angel investments is much less risky than debt financing. Unlike a loan, invested capital does not have to be paid back in the event of business failure. And, most angel investors understand business and take a long-term view. Also, an angel investor is often looking for a personal opportunity as well as an investment.
- • The primary disadvantage of using angel investors is the loss of complete control as a part-owner. Your angel investor will have a say in how the business is run and will also receive a portion of the profits when the business is sold. With debt financing, the lending institution has no control over the operations of your company and takes no share of the profits.
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- • Angel investor is a somewhat general term, and you can actually find these types of investors in a few different forms. Angel investments normally come from:
Family and friends: This is by far the most common source of funding for business startups that are interested in finding business start-up money and is the only option for many. Given the high rate of failure with new businesses, it is also risky in terms of the possible impact on relationships if the business is not successful. It is important to be upfront about the risk of failure.
Wealthy individuals: Another good source is successful business people, doctors, lawyers, and others that have a high net worth and are willing to invest up to (typically) $500,000 in return for equity. Often this is done by word of mouth through business associates or associations such as the local Chamber of Commerce.
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- Groups: Angels are increasingly operating as part of an angel syndicate (a group of angel investors), which raises their potential investment level accordingly. Investors contribute funds to the syndicate and a professional syndicate management team chooses the investments.
- Crowdfunding:A form of an online investing group, crowdfunding involves raising funding by having large groups of individuals invest amounts as small as $100.
