Angel Investors

Definition
individuals who invest time and money in very young companies. In fact, they often invest in an entrepreneur at a point when the business exists only as a good idea.
Angels are external investors - not merely friends and family - who invest on the merits of the opportunity, rather than because they may have a close relationship with the entrepreneur

 The most effective Angels help entrepreneurs shape business models, create business plans and connect to resources - but without stepping into a controlling or operating role.
Often Angels are entrepreneurs who have successfully built companies, or have spent a part of their career coaching young companies.

 The reason Angels can risk investing in raw startups, or out of the mainstream, is because they are investing their own money. Whereas VCs have to answer to those invested in their funds
Range of Investment size Ranges from Rs. 5 or 10 lakhs, up to Rs. 4 crores

 Typical Ownership range 20% to 50%

Valuation methods Angels usually look at two aspects: How much value has been created to date? How large can the company grow, and how much additional capital will it take to get there?

Differences
Angel investors, acting alone or in organized groups, are usually wealthy individuals, often with a successful entrepreneurial record, who invest their own money. Venture capital funds are corporate entities that pool money from a range of institutional and individual investors.

 Angel investors focus on the earlier stages of a company, expanding the company with the angel's investment to a more marketable size toward venture capital funds. Venture capital funds do invest in the earlier stages, but venture capital funds also invest with the purpose of taking the company to the IPO stage and beyond

 Angel investors vary in investment areas and act privately. Venture capital funds generally focus on emerging sectors like technologies, and have greater accountability for investments. This makes attracting angel investors seem easier than a venture capital fund's investment