Angel Investors: Who They Are & When Are They Appropriate
Angel investors are individuals who invest in emerging business ventures. Angels typically provide both capital and know how to companies who are in either their start up or expansion phases. To reflect the increased risk of investing in such firms, angels seek a higher rate of return versus traditional public stock investments.
Angel investors fulfill the financing need that exists between capital provided by friends and family and capital provided by venture capitalists. Individual angel investors often write checks from thousands of dollars. Recently, angel investing has become more organized, and angel groups often invest from $500,000 to $1,000,000 at a time to deserving ventures.
Angel investors often have similar financing criteria as venture capitalists. They want to see proprietary intellectual property, a large market size, management team members with expertise and experience and a current valuation that allows for a good return on investment.
In identifying and attracting an angel investor, companies should seek angel groups that are located in their region. For example, Shark Tank could be technically angel investors and they have funded dozens of businesses on the tv show.
When seeking individual angel investors, it is critical to network in order to create a personal connection between yourself and the angel. Also, ideally the individual has experience within your specific field so that he or she can provide industry contacts and operational expertise in addition to capital.
Angel investing can sometimes be more lucrative than investing in Stocks or Cryptocurrency, however it will often come with more risk, an alternative to this investing style is to buy micro cap companies, you can start early by finding companies in their startup face and expect potential higher returns, however the risk might be higher, another option is to invest in low cap cryptocurrency as well, same concept as before.