angel investor

An angel investor is, typically, a high-net-worth individual who provides early-stage capital to startups and entrepreneurs, typically in exchange for ownership equity or convertible debt. Unlike venture capital firms, which manage pooled money from many institutional investors, angel investors use their personal wealth and often invest in the "seed" or "pre-seed" stage when a business is just an idea or a prototype. Beyond financing, angels frequently provide strategic value by acting as mentors, offering industry expertise, and opening doors to their professional networks. Because they invest at such an early stage where the risk of failure is highest, they typically seek significantly higher returns than traditional investments to compensate for the risk.