Angel Investors

Angel investors are high net worth individuals who are willing to invest in early stage companies with fast growth potential. These investors are often entrepreneurs who have extensive experience in your industry and are willing to serve as mentors or board members of your business. Apple computer got its first round of outside capital from an angel. In 1977, an early Intel executive and shareholder invested $91,000 into Apple and guaranteed another $250,000 in credit lines. At the time of the Apple IPO in 1980, the angel was allegedly worth $154 million.

Angels usually want to invest in your business before a venture capital firm or institutional investor. and they often pay more than the founders, friends, and family. Sometimes, angels also invest at the same time and at the price as an institutional investor, this reduce the risk for angels course they know institutional investor has done a complete due diligence.

There is no one scientific way to locate angels, except through networking. Potential angels can rise through your business associations; affiliations with relevant trade associations; inquiries through your local banker, accountant, or attorney; local Chamber of commerce; and other small business entrepreneurs.

Angel investors can also be found from the following websites:

• ACE-Net (Access to Capital Electronic Network)
• The Capital Network
• Business Partners
• Cloud Start
• Garage
• Ground Floor Finance
• Vfinance

For entrepreneurs who need help locating angels, here are some guidelines from William Wetzel, a leading expert on angel financing and professor of management at the University of New Hampshire in Durham:

• Start early.
• Look close to home.
• Look for individuals who have a high net worth and a knowledge of your industry.
• Seek out wealthy individuals in philanthropic organizations, Chambers of Commerce, local advisory boards, and nonprofit organizations. Investors are usually involved in such organizations.
• Network, network, network.
• Have your business in order.
• Get references from professional contacts, such as lawyers and accountants.