Search for Small Business Loan Sources and receive your matched lender list
AND received FOUR free Business eBooks worth $39.95!
Search for Small Business Loan Sources

Start-up companies looking for an injection of cash and perhaps some mentoring can often find a good fit in an angel investor. An angel investor is a wealthy individual who has capital to put into new companies in exchange for equity or other financial promises. The “angel” part refers to their seemingly “heaven-sent” rescue of fledgling firms in need of aid. They might be entrepreneurs themselves who have already founded successful companies and are now looking to help others or they may simply have already made their fortunes and are looking to invest in the “next big thing.”

One of the added benefits of angel investors is that they often have a lot of business experience and can offer great advice and wisdom to new business owners. On the flip side, they may want to be more involved than the owner would like. They are also looking for businesses that are going to take off and become really profitable. A 2007 study  found that angel investors earned more than twice their investment in an average of 3.5 years. Because they are making a high-risk investment in a start-up they often want to have a say in how the company is run.The decision must be made carefully.

It used to be that entrepreneurs only found angel investors through their own personal network – a friend of a friend or a recommendation from a business owner’s banker, for example – but now many angel investors have started grouping together to make it easier to fund projects and shoulder risk. Personal networks are still the most effective way to find needed help though, as only about a tenth of all startups get financing from angels. Having connections often makes the difference in getting the deal.

For those looking to woo angel investor groups, a good place to start is the Kansas-based Angel Capital Association. Its website has a list of roughly 200 organized groups in the U.S., Canada and even a few overseas investors.


Search for Small Business Loan Sources and receive your matched lender list
AND received FOUR free Business eBooks worth $39.95!
Search for Small Business Loan Sources