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Role of Business Angel Investors

The wiki definition for an angel investor is “An angel investor or angel (also known as a business angel or informal investor) is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity. “ Angel investors are successful businessmen who are interested in helping startups in the initial stage of business.

A detailed business plan consisting of your product and services you are offering, market analysis and financial factors must be presented to your angel. The plan must clearly explain how much money you require, how it will be utilized, what are the returns and the time taken to make profits.

An article in Small Business Notes says “the total investment from angels has been estimated at anywhere from $20 billion to $50 billion as compared to the $3 to $5 billion per year that the formal venture capital community invests.”

Angels usually invest in small companies that are situated close to their business areas.

Angels will have 5 % to 25% stake in your business. Since they are entrepreneurs themselves they will lend a helping hand in various areas of your business. It is important to build a good relationship with your angel since he will be an integral part of your startup.

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