Supporting the business of science, one start-up at a time.

Angel Investors

An angel investor is typically a high-net-worth individual who can provide start-up capital for a business, usually in exchange for some form of ownership (equity). Like all funding sources, angels are typically looking for good returns on their investments, but unlike some other funding sources angels often demand less control over a start-up. Instead, many angels are themselves successful businesspeople, and relish the opportunity to help another entrepreneur get a business off the ground by leveraging their own skills and contacts. Thus, having well-connected angel investors behind a start-up can be extremely valuable to a company in its earliest stages, where sound advice and good contacts can dramatically improve the odds of success.

A small but increasing number of angel investors are organizing themselves into angel groups or angel networks in an effort to share research and pool their investment capital. In a way, this trend follows similar ones in both stock and real-estate investing, where groups have formed for the purpose of sharing methods and research results while providing opportunities for socializing with like-minded people.

The availability of angel capital fills the gap in start-up financing between "friends and family," who might provide small amounts of initial seed funding to help get your business off the ground, and venture capitalists and bankers, who typically invest larger amounts of money in more established businesses. It can be quite difficult to raise more than a few tens of thousands of dollars from friends and family, while many traditional venture capital funds won't consider investments under about $2 million and banks prefer to lend to already-established firms with good records of sales and profits. Thus, angel investors can be an attractive source of second-round financing for many high-growth start-ups in the 250 K to 3 M$ range.