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Advantages And Disadvantages Of Angel Investors

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5) ANGEL INVESTORS:
Those looking to finance their business can always look to an angel —an angel investor, that is. Angel investors have helped to start up many prominent companies, including Google, Yahoo and Costco. This alternative form of investing generally occurs in a company's early stages of growth, with investors expecting a 20 to 25 percent return on their investment.

ADVANTAGES:
• No need of collateral.
• An entrepreneur is free to make decisions.
• Angel investors provide desired support, expertise and contacts in making a business grow.
• They provide needed amount using their own personal funds for investment.
• Angel investors have a more informal investment criteria compared to the traditional financial lenders.

DISADVANTAGES: …show more content…

• Angel investors are ready to invest additional funds only when the business is generating profits.

6) CROWDFUNDING:
Crowd funding is a funding option by raising monetary contributions from large number of people. It is based on three types of actors-the project initiator who proposes the idea to be funded, individuals or groups who support the idea and a moderating organization that brings parties together to launch the idea.

ADVANTAGES:
• It can be a fast way for the entrepreneur to raise funds for the business.
• Crowd funding help you to get feedback and expert guidance on how to improve your business.
• It is a good way to test the public’s reaction to your product/idea.
• Your investors often become your loyal customers through the financing process.
• It is more efficient than traditional options of fund raising.

DISADVANTAGES:
• An entrepreneur need to do lot of work in building up interest before the product launches.
• If an entrepreneur have not protected its business idea with a patent or copyright, someone may see and steal your concept.
• If crowd funding campaign fails, the details will remain on the crowd funding platform for all to

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