Angel Investors

Definition
Individuals who invest time and money in very
young companies. In fact, they often invest in an
entrepreneur at a point when the business exists
only as a good idea.
They are focused on helping the business
succeed, rather than reaping a huge profit from
their investment.

 Angel investors give more favourable terms than other

lenders, as they are usually investing in the person rather
than the viability of the business.
The most effective Angels help entrepreneurs shape
business models, create business plans and connect to
resources.
Often Angels are entrepreneurs who have successfully
built companies, or have spent a part of their career
coaching young companies.

INVESTMENT PROCESS
Range of Investment size
Ranges from Rs. 5 or 10 lakhs, up to Rs. 4 crores
Typical Ownership range 20% to 50%
Valuation methods
Angels usually look at two aspects:
How much value has been created to date?
How large can the company grow, and how much
additional capital will it take to get there?

Differences : Angel Investors &

VCs
Angel investors, acting alone or in organized
groups, are usually wealthy individuals, often
with a successful entrepreneurial record, who
invest their own money.
Venture capital funds are corporate entities that
pool money from a range of institutional and
individual investors.

ANGEL INVESTORS & VCs

Angel investors focus on the earlier stages of a

company, expanding the company with the
angel's investment to a more marketable size
toward venture capital funds.
Venture capital funds do invest in the earlier
stages, but venture capital funds also invest with
the purpose of taking the company to the IPO
stage and beyond

 Angel investors vary in investment areas and

act privately.
Venture capital funds generally focus on
emerging sectors like technologies, and have
greater accountability for investments. This
makes attracting angel investors seem easier
than a venture capital fund's investment