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An angel investor is a high net-worth individual who provides financial backing to startups or early-stage companies in exchange for an ownership stake or convertible debt. Angel investors typically invest their own personal funds and often have industry expertise and a network of contacts that can help the startups they invest in. They typically invest in companies that are too early for venture capital funding but have shown some potential for growth.
Angel investments are typically high risk, but can also offer the potential for high returns. Unlike venture capital firms, angel investors often take a hands-on approach, providing not only funding but also mentorship and support to the companies they invest in. The goal of an angel investor is to help the startup grow and eventually either go public or be acquired, generating a significant return on investment.