Wednesday, July 05, 2006

Angel Investor: Business with an Alliance of Angels

How good will businesses turn out when dealt with angels? Will it be as good as heaven-sent success?

According to the Center for Venture Research at the University of New Hampshire, in the year 2005 there were 225,000 angel investors who are active in their ventures. A year before it, it was reported by same institution that 18.5% of the deals presented to investors by the angels magnetized funding. Said figure increased by 10% compared to the previous year’s performance. To sum it up, in the year 2004, approximately 45,000 companies in the United States received angel investor funding. Each of these companies has received an average raise of approximately $469,000. The largest category was software.

You might be asking how they come up with the term angel investor. Angel comes from the traditional epithet in the early 1900’s. They are given to wealthy producers of Broadway productions. Angels, as used nowadays, connotes expertise, experience, influence and wealth.

Angel investors are building an amazing hype these days. In fact, more and more people are hooked by them. Their goal is to provide capital for business. Generally, the giving of capital is in lieu of acquiring ownership equity.

An angel investor is an individual who seeks higher return on investment compared to the traditional investment that the business world is offering. Usually, angel financing ranges from $150,000 to $1.5 million.
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