-
The
difference
between
a
venture
capitalist
and an
angel
investor. A
venture capitalist
differs from an
angel investor in
terms of wanting
grater control of
company and quicker
return on
investment.
A
venture capitalist
is a professional
investor. He or she
manages a fund and is
looking for suitable
investments for that
fund. VCs usually invest
anywhere between $500k
to several million
dollars in a startup or
established small
business. These folks
are serious full-time
investors and demand a
much larger share and
much more control over
your business than any
other group. However,
they'll also rally
around you to do as much
as possible (provide
contacts, etc) to ensure
that the business
succeeds and they see a
handsome return on their
investment. In
other
words,
the
venture
capitalist
may
have
no
business
experience
applicable
to
the
industry
your
company
is
involved
in,
and
is
focused
on
the
potential
rate
of
return
your
company
can
provide.
An
angel
investor
is
an
individual
who,
while
also
looking
for
a
suitable
investment,
is
also
looking
for
a
personal
opportunity.
Angel investors are
individuals who invest
their own private
capital into startups
and small business.
Angels typically invest
$500k or less into a
business and are a great
resource if you can't or
don't want to round up
money through your
friends and family.
Angels will demand and
larger share and more
control over the
business than your
friends and family, but
there's less risk in
losing a close
relationship if the
business goes under.
An
angel
investor
often
has
business
experience
relevant
to
your
company
and
is
interested
in
adding
value
to
your
company,
as
well
as
making
a
return
on
his
or
her
investment.
-
Before raising
capital
for your business,
make sure that your
business is indeed
"fundable". You need
to understand the
mind of an investor.
They are looking to
make more money with
the money they
already have, any
credible investment
company is going to
thoroughly check the
facts before sending
any money your way.
-
Basic principles of
a Venture
Capital or Angel
Fund.
Understand what
their motivations
are and what their
investment criteria
are and you should
be able to match
your interests with
theirs. Although it
may all sound big
and intimidating
VCs and Angel
investors are
straightforward,
they are in
business to make a
few investments that
win big. The average
lifespan of a fund
being is about 10
years. Venture
Capital investment
is not for everyone,
they tend to invest
from 500K upwards
funds can be
contributed by
multiple sources,
including the VC's
themselves, but more
typically this
investment capital
comes from large
institutions with a
lot of money that
they need to invest,
such as
universities,
insurance companies,
state pension funds
and other types of
grouped investment
sources. Where as
Angel Investors tend
to invest 500K
downward the funds
are usually their
personal capital.
-
The roll of a Venture Capitalist
or an Angel
Investor
They sort out the
good deals from the
bad ones, they
provide direction
and strategies, help
recruit talent and
find other sources
of capital. They can
deliver a great deal
of value to a
company if used
appropriately.
Search for VC's, Angel Investors
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