Business angels are a gift from heaven when it comes to needing help in really jump-starting your company. Whether your business is still crawling round on all fours or has started walking slowly on its own, business angels can provide that crucial influx of finance to get your company running, and perhaps even flying by the end. Business angels are individuals with a high net worth, usually seasoned entrepreneurs, who are interested in providing financial investments to growing companies in exchange for private equity. Often confused with the concept of venture capital, business angels differ slightly; while venture capital is commonly associated with large companies able to offer investments of over $1 million, business angels are individual investors putting up money from their own pockets, which can be anything from $10,000 to $1 million. As such, they will invest less money because of the enormous risks they take by investing alone. Read through our post on venture capital if you think this might be useful to you. Here are some more detailed features of business angels.

 Are business angels the answer to your prayers?

As opposed to venture capital firms, business angels can be much more pleasant to deal with when taking someone else on board to expand your company. Venture capital firms will usually demand a seat on the board of your company, and will be extremely cutthroat in taking business action. Generally, venture capital firms also get into bed with companies once they are already up and running, but need substantial resources to really take off.

Business angels, on the other hand, are usually found very early on; spoon-feeding the company and nurturing it, hence their name. Since they are normally experienced entrepreneurs themselves, business angels can turn out to be good mentors in many cases. And having invested so much in you and your company, you can bet that they have your best interests at heart and will do everything in their power to see you succeed. In case you’re interested, have a look at our previous post on business mentors to see how having one can benefit you. Whether it’s supplying you with helpful business contacts or overseeing your work and advising you, business angels will frequently be on hand to provide assistance.

This is the world of business, though, and not everything is sunshine and rainbows; there is always a catch. Whoever you choose to invest in your company, expect them to want a generous reward in return for the risks you expect them to take. No one is perfect, not even angels; nevermind business angels. Be prepared to give up anything from 10% to 50% of your business to investors in exchange for their financial help. You should also be wary of the possibility that your investors may eventually force a move to make your company go public, or even sell it to capitalize on their investment. There are a lot of pros and cons to take into account, so think it through before coming to a decision. One thing is clear, though, and that is that no business can make it on its own; everyone needs an angel on their shoulder.