Investors who support early stage companies are often called Angel Investors. The benefits of Angel Investors are:
Angel Investors are experienced investors who understand the risks involved in these early stage companies.
Angel investors are typically experienced business people seeking investment opportunities in early stage, as well as more established businesses.
Angel Investors range from young business professionals to wealthy, retired ex-business owners.
They understand the risks
Angel investments can be high risk since the entire investment could be lost if an early stage company fails. A key way Angel investors mitigate risk is to invest with other Angel investors.
Actively assessing investment opportunities together (completing due diligence) and guiding investee companies post investment can substantially reduce risk.
Many investors bring specific industry expertise and business skills to the table. The skills of Angel investors extend across a variety of areas including governance, senior management, marketing, sales, finance, technology and operations.
Active Angel investors may choose to join an angel network so they can also participate in due diligence, mentoring and provide business expertise to companies that seek capital.
Your angel investors, are a valuable resource and it is important you utilise the skills you need, and keep in close contact. Enterprise Angels will facilitate the appointment of an Investor Representative to liaise between your management team and your investors to assist with this.
View Part 5 here.