Where Can I Get Funding From Angel Investors?
More than likely if you are looking for Angel investors you are wanting to start up a business or in the process of starting up. Finding investors to put their money into your business can be pretty tough but there is a hand full of ways that you can go about finding these investors instead of just asking all the wealthy people you know for their money.
What is an Angel Investor
Angel investors invest in small startups or entrepreneurs. Often, angel investors are from an entrepreneur’s family and friends. The capital angel investors provide may be a one-time investment to help the business propel or an ongoing injection of money to support and carry the company through its difficult early stages.
Not just anyone who as wealth can be classified as an Angel Investor. Angel investors must meet the Securities Exchange Commission’s (SEC) standards for accredited investors. To become an angel investor, one must have a minimum net worth of $1 million and an annual income of $200,000. So when you start speaking with different investors and they claim they are an Angel Investor, they need to meet specific criteria to claim that title.
Finding Angel Investors
Family and Friends
A large portion of startups and entrepreneurs will start with friends and family members that are wealthy and are willing to support you. This can be great but at the same time terrifying. With having a friend or family member invest in you can be very beneficial in a way that it is someone that you know and trust but your relationship can also turn into a disaster if your startup goes down the drain or you don’t use the money wisely. The last thing you would want is to lose a relationship with a friend or family over business matters. But, at the same time, many people have had great success from Angel Investors among their family and friends.
Individual Angel Investors
Like mentioned above, your friends and family know and trust you, but seeking an investor that you don’t know and they don’t know you could be very challenging. Some investors choose to stay anonymous so they are not bombarded with thousands of people bugging them to invest in their business. Trying to find people like this that are not wanting to be found can be frustrating but the more you tell people who you are and what you are trying to do, the more likely to meet some of these investors.
Going the route of speaking with different Angel Investing Firms may be your best route if you don’t know anyone personally or don’t have a large network of connections. These firms will typically have a couple hundred Angel Investors that pool together capital and utilize a team to help make decisions on where they should invest their money. This becomes less risky for the individual investors and also gives you the potential of making partners with the right group of investors that fit you.
Here are a handful of known Angel Investor Firms:
Golden Seeds LLC, New York City
Number of angels: 190
Who it helps: Members invest directly, or through a managed fund, in companies that are founded by or led by women. Sectors include consumer products, technology, software and life sciences.
North Coast Angel Fund, Cleveland, Ohio
Number of angels: 180
Who it helps: Invests in Ohio-based technology startups.
Tech Coast Angels, Los Angeles
Number of angels: 263
Who it helps: Provides connections, knowledge, mentoring and operational assistance to early-stage entrepreneurs in the tech, biotech, consumer products, Internet, information technology, life sciences, media, software and environmental markets.
Investors’ Circle, San Francisco
Number of angels: 225
Who it helps: Uses private capital to promote businesses that address social and environmental issues. The group has invested almost $150 million in 225 companies, it says.
Hyde Park Angel Network, Chicago
Number of angels: 133
Who it helps: Members invest in seed and early stage businesses, primarily located in the Midwest. Industries include: information technology, business services, industrial technology, financial services, consumer or industrial products and healthcare services.