What is a Business Angel?

A business angel is not a saint-like little creature with wings that make all of your business problems go away with the flick of a wand. A business angel, also known as an angel investor, is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity. So let’s say you’re just starting up your business but you’ve been refused a loan from the bank and your hopes are low, but you have very good plans for the future and you just need a little bit of cash to get going. Well, a business angel can help, and what they do is offer you the required amount of money to get your business off the ground, and they do this for a share in your company. It can work well because they want you to succeed, and at the end of the day they will lose money if your enterprise fails, so you may end up working together and actually taking the business forward to great heights. The share they require will depend on the investment they need to make and their belief in you, so this is the main haggling point.