What is angel investor?

An angel investor is a high-net-worth individual who provides early-stage capital to startups or entrepreneurs in exchange for equity ownership or convertible debt. Unlike traditional investors, angel investors typically invest their own funds rather than institutional money, often supporting innovative ideas with high growth potential but limited access to venture capital.

Angel investors play a crucial role in seed funding, bridging the gap between personal savings and professional venture funding. They usually invest smaller amounts (ranging from $25,000 to $1 million) compared to venture capitalists. In addition to financial support, they offer mentorship, industry connections, and strategic guidance to help startups scale.

Their involvement is often informal, with flexible terms and a focus on long-term value creation rather than immediate returns. Networks of angel investors, such as AngelList or local business groups, facilitate deal flow and due diligence for early-stage ventures.