How To Find Angel Investors for Small Business
Do you know how to find angel investors for small business? An angel investor is a person investing his or her own money in a promising company.3 min read
Do you know how to find angel investors for small business? An angel investor is a person investing his or her own money in a promising company, in contrast with professional money managers, who invest the money of other individuals or companies. Many angel investors are lawyers, doctors, and other wealthy professionals. Often, these individuals are retired and choose to invest in a field where they have special expertise.
Profile of an Angel Investor
The average angel investor:
- Is between 40 and 60 years old.
- Has an annual income of more than $100,000.
- Has a net worth of at least $1 million.
- Has experience as a successful entrepreneur.
- Plans to invest for a five-to-seven year term.
- Prefers to serve in an advisory capacity for the company in which he or she is investing.
- Invests up to $150,000 but may partner with other angel investors for more substantial projects.
- Refers deals he or she is not interested in to other angel investors.
- Finds deals through the referrals of others.
- Is not risk-averse but expects to be well-compensated for this risk.
Benefits of Angel Investors
If your business needs financial flexibility to grow, a cash infusion from an angel investor could give it a jump start. These investors provide substantial funds that can bolster your small company's development and growth.
Choosing an angel investor with targeted entrepreneurial experience in your industry can create a valuable mentoring relationship. This advice can often be just as valuable as the cash investment, if not more so.
Attracting Angel Investors
Your company is a good candidate for an angel investment if it has export and growth potential, even if it may take several years to realize this potential.
Because these investors tend to want to take an active role in the business, you'll be more likely to attract an investor who lives near your business location.