What does angel round financing mean?

Hello, angel round financing is a stage of venture project financing, and it is an individual's early direct investment in some start-ups Generally, angel round financing enterprises have just started to operate, and the products have not yet come out or been sold, so angel round financing funds are generally used for product development.

Angel Wheel, that is, angel investment, refers to personal investment to help entrepreneurs who lack their own funds to start a business with professional skills or unique ideas, take high risks when starting a business, and enjoy high returns after starting a business successfully. In other words, it is a one-time upfront investment made by free investors or informal venture capital institutions to original project ideas or small start-ups Angel investment is a special form of venture capital.

I. Characteristics of angel investment

Angel investment refers to a one-time early investment in original project ideas or small start-ups by free investors or informal venture capital institutions to help entrepreneurs who have professional skills or unique ideas but lack their own funds to start their own businesses, so as to bear the high risks in their entrepreneurship and enjoy high returns after their success. Angel investment is a special form of venture capital. Angel financing has the following characteristics:

(1) angel investment generally only provides "first round" small investments. Angel investment is generally an individual investment, which belongs to individual or small business activities, so the amount is generally small. "Angels" only use their own savings, which is not enough to support large-scale capital needs. Therefore, those business plans that are in the early stage of development can be favored by them.

(2) Angel investment often has a strong emotional color. The process of persuading "angels" by entrepreneurs often requires a certain emotional foundation. Entrepreneurs and "angels" are mostly introduced by like-minded relatives and friends or acquaintances.

(3) The financing procedure of angel investment is simple and quick. Because "angels" only invest for themselves, the investment behavior is accidental and random, and there is no complicated investment decision-making procedure. Investment decision-making is mainly based on human investment, so the investment decision-making speed is very fast.

(4) Angels have short-term behavior on investment projects. "Angels" invest with their own funds and have high hopes for the return on investment. This form of investment is not as resistant to risks as those of large investment companies that can spread risks through their portfolios. Therefore, the "angel" is not strong and short-sighted.

(5) Angel investment is a high-risk and high-return equity investment.