Angel+Financing

=Angel Financing = = =

Characteristics of Angel Financiers:

 * Angels are silent, private investors who provide start-up firms with seed money financing in exchange for equity or a percentage of revenues.
 * Angels provide seed money for firms too young or too small to qualify for bank loans, venture capital, or public offerings; they prefer to invest at the early stage of a venture.
 * Angel networks are oriented to bio-tech and other high-tech companies.
 * Angels typically invest in ventures involving markets and technologies with which they are familiar.
 * Angels typically invest in ventures close to home within one day's drive.
 * Angels tend to co-invest with trusted friends and business associates.
 * Angels are active investors, serving on a working Board of Directors or providing guidance through an informal consulting/monitoring role.

Angel Investment Criteria:

 * The primary difference between VCs and angels is that angels will accept a longer payback horizon and are willing to settle for a smaller return - 20% to 25%/year compared to the VCs expected ROI of 30% to 35% or more per year.
 * A round of angel financing is typically less than $1M and more usually less than $500K.
 * Venture exit horizons for angels tend to be 5 years to 10 years or more.
 * Firms do not have to demonstrate profitability; they must demonstrate, however, strong market prospects and strong management.
 * Angels often take bigger risks or accept lower rewards when they are attracted by the non-financial characteristics of an entrepreneur's proposal, especially the opportunity to help direct market entry of a next-generation technology.
 * Angels' investment terms and conditions tend to be briefer and more informal than those of venture capitalists.

//<span style="font-family: 'Times New Roman',serif; font-size: 12pt; line-height: 1.5;">(Adapted from: Small Business Innovation Research / Small Business Technology Transfer, accessed 2/6/13) //

<span style="font-family: 'Times New Roman',serif; font-size: 12pt; line-height: 1.5;">Example angel investor from my personal experience: Steve Walker and Associates <span style="font-family: 'Times New Roman',serif; font-size: 12pt; line-height: 1.5;">See also: Angel Investing