Entrepreneurs always have new ideas in their minds. They need to implement these ideas, but to do so you need investments. Business angels are a great source of money for your business. Here are the major types of angel investors who might provide a fund for your business.
1. Friends and family
You can get money from your friends and family. They are a very reliable source of fund. However, you should make sure that you don’t mix up your personal relationship with your professional one. You should tell your friends and family in advance that there is no guarantee that your business will be successful. So, they can take their decision whether to take the risk of giving you their valuable money or not.
2. Individual angel investors
It is a tough way to find financing as most of the time they want to stay anonymous. You should look for an investor who is interested in the business niche you want to work in. These investors will understand the business model and the value of your project.
3. Angel investor networks
These networks let the investors stay anonymous. They have a team who manages the investments. These networks can provide investments that are of higher amounts and well managed.
4. Fundraising advisors
It is an expensive way to get fund. They take between 5% and 7% of success fees. They even take monthly fees to cover their costs. You should understand the terms and conditions well before taking money from them.
Investors are interested in people as well, besides the business idea. So, it is very important that you build up a good relationship and expand your network. The investors must be able to trust you.