key term - Angel investors

Definition

Angel investors are affluent individuals who provide capital for a business start-up, usually in exchange for convertible debt or ownership equity. They typically step in after the initial "seed" funding round and before venture capitalists.

Related terms

Seed Funding: The initial capital used to start a business, often coming from personal assets or family and friend investments.

Venture Capitalists: Professional group investors that provide large amounts of money for businesses, typically with high growth potential, in exchange for equity stakes.

Equity Financing:

A method of raising funds by selling shares of the company to investors, thereby offering them ownership interests