Informal Investors or "Business Angels" are wealthy individuals who are prepared to use their financial resources to make risk investments based on their experience and interests. They may be often retired senior exEurotives of major enterprises, or people who have sold their companies and now wish to use the money. Their motivations are many and they may invest alone or in small groups.
Informal Investors or "Business Angels" are likely to take a "hands on" approach to their investment, normally choosing to become a shareholder in the company, that is part owner of it. Typically, they are good for investments below 250.000 Euro.
| Informal Investors entail: |
But: |
| Equity share (mostly) |
Danger of excessive intrusion in business |
| Patient money - less pressure for exit |
May become "Business Devils" |
| Possible "leverage effect" on other investors |
Less able to provide follow-on finance |
| Small amounts of finance |
Less finance available |
| Cheaper in fees to obtain than Venture Capital |
Invisible, more difficult to find |
| Provide know how, advice and contacts |
Networks less extensive |
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