Alternatives in Venture Financing
John Vinturella and Suzanne Erickson
Angel investors are high-net-worth individuals who choose to invest in start-ups rather than or in addition to investing in the stock market. Many angels are entrepreneurs who prefer the thrill and potentially high returns of investing in new ventures. In addition to dollar investments, these angels offer guidance and experience to the entrepreneur.
The best way to locate angel investors is through networking. Most angels invest locally, in industries with which they are familiar. Lawyers, accountants, and other entrepreneurs are good sources of introduction to angel investors.
Entrepreneurs seeking external equity are faced with an inherent conflict. ...