What Are Angel Investors?

Angel investors are individuals who use their wealth to invest in company startups and businesses such as eCommerce. These are private wealthy individuals investing their own money into a business, not to be confused with Venture Capitalists. The angel investors then take a percentage of share in the company in order to make back their initial investment plus interest.

How Does Angel Investing Work?

The angel investor will front the money to the business in exchange for shares of the company – or a percentage of the profits – until the investment and interest are paid back and they can be bought out. This is different from a loan because if the company does not succeed or make profits, the investor loses out on their money.

How To Find Angel Investor

Social networking and crowdfunding sites are the optimal place to find angel investors. While crowdfunding is a different type of funding, it can still attract attention from potential investors. Social media such as LinkedIn is a successful way to connect with other entrepreneurs and investors. LinkedIn is the professional social media platform, but Facebook is still one of the most well known ways to connect online.