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Angel Investing Vs Venture Capital
Posted by Bhavna Solanki on March 9, 2021 at 11:43 amWhat is the difference between venture capital funds and business angels?
- This discussion was modified 1 year, 2 months ago by saquib.
Vihaan Sharma replied 2 years, 9 months ago 8 Members · 10 Replies -
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Business angels are individuals often successful business people, who are using their own funds to invest in businesses they like. On the other hand, Venture capitalists manage the pooled money of others in a professionally managed fund.
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It depends on whether your business is at its early stage or is established.
Angel investors and venture capital funds focus on businesses in different life cycles. Angel Investors typically invest in early-stage businesses and startups. Whereas, Venture Capitalists prefer investing in more established companies.
You can choose your funding strategy accordingly!
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Angel Investors or Venture capital: which is better for a newbie startup?
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Well, this depends on the company’s development. If your company is early-stage, a business angel is probably best to look for. The amount a business angel invests will be enough for you now, considering the early stage your business is in. Because of the personal relation, you will build with this type of investor, he or she will serve as your mentor.
Once your business is established, and you can provide security to your investors, you can start thinking about venture capital.
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Six myths about venture capitalists
http://www.hbr.org/2013/05/six-myths-about-venture-capitalists
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I have a tech start-up. I have planed and structured everything except the funding part. Any suggestions on which form of funding should a tech startup pitch to?
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Hey @Ansh , There’s a myth that apart from investment, only VCs can bring value to a company in the form of experience and advice. Well! that not true. The angel investors I have worked with were thoughtful and helpful. The point is that there’s no substitute for knowing your investors.
If you trust that the person putting money into your company has good experience and your best interests at heart, it doesn’t matter whether they are an angel or a VC.✌
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Thanks for your suggestion buddy!! Really helpful????????
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@Aryan Absolutely correct! It doesn’t matter whether your investor is an Angel investor or VC until you trust his experience and mentoring. I have meet few investors who have mentored me and guided me in the best possible manner. A investor is focused on the growth of company, because he has his money into it.
Thus, every investor tries to grow the company he invests in.
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