Angel Investor
A high-net-worth individual who provides capital to startups in exchange for equity ownership, typically in early stages.
Definition
Angel investors are affluent individuals who invest their personal funds in early-stage startups, often providing not just capital but also mentorship, industry expertise, and valuable networks. They typically invest before venture capital firms and help bridge the funding gap between personal savings and institutional investment.
Key Characteristics
- • Invest personal money, not institutional funds
- • Typically invest $25K-$100K per deal
- • Often have industry experience or expertise
- • Provide mentorship and strategic guidance
- • Take smaller equity stakes than VCs
Real-World Example
Tech Startup: Former Google executive invests $50K in a B2B SaaS startup for 2% equity
Beyond capital, the angel provides industry connections, product feedback, and helps recruit key team members.