angel investor

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Angel Investor

A high net worth individual who provides financing to a start-up, either in exchange for convertible debt or equity. Among start-ups, they are thought of as a bridge between loans from family and friends and venture capital, though angel investors are themselves often personally connected to the business. Angel investors take on a great deal of risk when they invest in these start-ups; they are also subject to dilution at the start-up's IPO. Therefore, they usually require a high rate of return in exchange for their financing. They are informally known as angels or informal investors.

angel investor

A wealthy investor who provides capital for new business ventures.
References in periodicals archive ?
The interest in the role of informal investors in the venture capital market has increased since the identification of the business angel's participation in early stages of entrepreneurship (Heukamp, Liechtenstein, & Wakeling, 2006).
Studies on informal investors have been basically focused on the sub-segment, of business angels, and it is particularly relevant that few scholars have adopted a gender perspective in this field (Sohl, Hill 2007; Harrison, Mason 2007; Zimmerman, Scott 2006; O'Gorman, Terjesen 2006; Blake 2006; Green et al.
The study debunks the classic picture of an informal investor as a ``business angel'' - a person with enough spare cash and business experience to invest in other businesses.
1989) Attitudes and behaviors of informal investors toward early-stage investments, technology-based ventures and coinvestors.
Now plans are under discussion to enlarge the scheme to the whole range of informal investors, including intermediated informal funds.
Informal Investors, BAN Members, and Members of National and European Parliaments will contribute to this Conference through informal dialogue.
Within the research canon on informal venture capital, the issue of trust has been explored as part of a wider study of information sources, networks, and reliance structures (Fiet, 1991): for the informal venture capital market, Fiet's results suggest that the degree of reliance on others in the personal contact network (which was lower in any case for informal investors compared to venture capitalists) was a function of the amount of network experience; in other words, "experience generated trust which controlled opportunism" (Freear et al.
It needs to be emphasised at the outset that informal investors are extremely difficult to identify and locate.
LINC Scotland brings the "angels" in the shape of informal investors into contact with new and developing companies in need of funding.
AMSTERDAM -- On April 14, 2011, IIP closed a round of funding with informal investors to fuel growth and create extra capacity within the FUGA (www.
Informal investors such as business angels are also a possible source of such finance, although it is becoming clear that the entrepreneur seeking such finance must have the knowledge and ability to identify a feasible development project and produce a supporting business plan to realise it.
In making their investment decisions, informal investors are motivated first and foremost by the opportunity for high capital appreciation.

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