If you are reading this article then you are probably in the market for an angel investor. As such, there are a few things that you need to know before you start the capital raising process. First, angel investors are typically very smart business people that have earned a substantial amount of money through their own business dealings. There are not many of these private investors that have inherited their money.
Second, most private investors are entrepreneurs. As mentioned above, these investors have been usually involved with their own business ventures for a number of years. As such, they have a tremendous understanding regarding how businesses operate. This is one of the best aspects to working with these private funding sources. This is due to the fact that they can provide you with a tremendous amount of advice as it relates to the day to day operations of your business.
Third, angel investors usually have a net worth of $1,000,000 to $5,000,000. The average investor usually has a net worth of $2.5 million. They are typically willing to make an investment of $50,000 to $250,000 into a local business or small business. In some instances, especially if they will be involved with the operations of the business, these private funding sources may contribute more capital to your new business or ongoing business venture.
Fourth, most private investors want to have their investments located within fifty miles of their residence. This is due to the fact that they are going to want to check into the business from time to time. In some instances, private funding sources may be willing to travel further distances if you have a highly unique business concept that warrants the extra travel. Additionally, with the advent of the Internet and related communications, many angel investors are willing to provide capital to companies that are further away since they can still keep tabs on their business even if they are located several hundred miles away.
Fifth and finally, angel investors are secretive people. They do not want to be known by the general public as a funding source for small businesses. This is due to the fact that they do not want to be flooded with requests for capital or business plans on an ongoing basis. When it comes to advertising among private funding sources, many angel investors work in groups that seek out private small business investments.
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