Starting a new business typically requires some capital. The amount can vary widely depending on the type of business. For example, an accountant looking to start a business helping others with their taxes may not need much money to get started as a restaurant. Restaurant startup costs are much higher because you first need a location, equipment, licenses, and staff.
As an aspiring entrepreneur, if you don’t already have the personal finances to start the business of your dreams, there are other ways to fund your business. One of these options is finding one or more angel investors.
What is an angel investor?
An angel investor is an individual who provides capital for startups, often in exchange for a percentage of the company’s ownership equity. They differ from venture capitalists, who typically manage pools of capital from a range of people. Angel investors may provide one-time funding to help the business get started, or they may commit to more ongoing support. Angel investors are sometimes referred to as private investors, seed investors, or angel funders.
How do I find angel investors?
Often, angel investors come from the business founder’s network of family and friends or their professional network. This is because angel investing can be risky; if the business fails, the angel investor may lose their whole investment.
However, most people may not have access in their immediate circle to wealthy individuals who are willing to invest in their business. Luckily, there are increasing ways to connect with potential angel investors for your business.