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Startup Financing Options to Fund Your Growing Business

Silent Rich’s comprehensive guide to startup funding and business financing options will help you explore the right funding options for your unique situation, whether you are a first-time entrepreneur or a seasoned executive.

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Before you begin your business, it’s essential to prepare. The first and most important step is to create a detailed business plan. This will help you get financing from investors and lenders. Include details about your product or service and your goals for the future in your plan. Be sure to also create a budget for start-up costs and ongoing expenses.

If you plan to borrow money to fund your business, you may want to build equity financing as well. This will ensure that you have an appropriate amount of debt and equity in your company.


Angel Investment Groups In United States

Angel Investment Group: 
Grand Strand Angel Network, Inc Visit Website
757 Angels, Inc.Visit Website
Acadiana AngelsVisit Website
Accelerate Venture PartnersVisit Website
Aggie Angel NetworkVisit Website
Alabama Capital NetwokVisit Website
Alamo AngelsVisit Website
Alaska Investor NetworkVisit Website
Alliance of AngelsVisit Website
Ambassadors Impact NetworkVisit Website
American Sustainable Business NetworkVisit Website
Angel Investor ForumVisit Website
Angeles InvestorsVisit Website
AngelList LLCVisit Website
Appalachian Investors AllianceVisit Website
Ariel Savannah Angel Partners, LLCVisit Website
Arizona Tech InvestorsVisit Website
Ark Angel AllianceVisit Website
Astia AngelsVisit Website
ASU InvestUVisit Website
Atland VenturesVisit Website
Atlanta Technology AngelsVisit Website
Aurora Angel NetworkVisit Website
Austin Area AngelsVisit Website
Band of AngelsVisit Website
Baylor Angel NetworkVisit Website
Beacon Angels LLCVisit Website
Beam Angel NetworkVisit Website
BELLE Capital USA, LPVisit Website
BELLE Michigan Impact Fund, LPVisit Website
Bellingham Angel InvestorsVisit Website
Ben Franklin Technology Partners of Northeastern PaVisit Website
Ben Franklin Technology Partners of SE PAVisit Website
Beyond AngelsVisit Website
BiovergeVisit Website
Black and Latino Angel FundVisit Website
Black Angels MiamiVisit Website
Blu Venture InvestorsVisit Website
Blue Angels - Sea AheadVisit Website
Bluegrass Angels IncVisit Website
BlueTree Allied AngelsVisit Website
Boston Harbor AngelsVisit Website
Branch Venture GroupVisit Website
Broad Street AngelsVisit Website
Bronze ValleyVisit Website
Buffalo Angel NetworkVisit Website
CANCER FUNDVisit Website
Canyon AngelsVisit Website
Carolina Angel NetworkVisit Website
CAV AngelsVisit Website
Centennial InvestorsVisit Website
Central Illinois AngelsVisit Website
Central Texas Angel NetworkVisit Website
Charleston Angel PartnersVisit Website
Charlottesville Angel NetworkVisit Website
Chemical Angel NetworkVisit Website
Cherrystone Angel GroupVisit Website
Chicago Booth Angel Network of Silicon ValleyVisit Website
Citrine AngelsVisit Website
Clean Energy Venture GroupVisit Website
Columbia Business School Angel ClubVisit Website
Commune AngelsVisit Website
Cottonwood Wealth StrategiesVisit Website
Country Roads Angel Network, LLCVisit Website
Countryside AngelsVisit Website
Cowtown AngelsVisit Website
CreativeCo CapitalVisit Website
Delaware Crossing Investor GroupVisit Website
Delaware Innovation SpaceVisit Website
Desert AngelsVisit Website
Digital Health AngelsVisit Website
DTN Ventures LLCVisit Website
DUAngelsVisit Website
Duke Angel NetworkVisit Website
E8Visit Website
Eastern New York AngelsVisit Website
eCoast AngelsVisit Website
ECS AngelsVisit Website
Enterprise InstituteVisit Website
Erie Regional Chamber and Growth PartnershipVisit Website
Executive Forum AngelsVisit Website
FIN CapitalVisit Website
Five Star BankVisit Website
Florida FundersVisit Website
Flywheel Angel NetworkVisit Website
Flywheel Social Enterprise HubVisit Website
Founders First Capital Partners, LLCVisit Website
FrontierAngelsVisit Website
Fund NVVisit Website
GaingelsVisit Website
Georgetown Alumni Investor Network (GAIN)Visit Website
Golden Angels InvestorsVisit Website
Golden Seeds LLCVisit Website
Gopher Angels, LLCVisit Website
Grand AngelsVisit Website
Great Falls Development AuthorityVisit Website
Groove CapitalVisit Website
Guindy Alumni Angels AssociationVisit Website
Halcyon Impact Angel NetworkVisit Website
Hamilton Real Estate Tech InvestorsVisit Website
Harvard Business Alumni Angels of Greater New YorkVisit Website
HealthTech CapitalVisit Website
Hivers and StriversVisit Website
Houston Angel NetworkVisit Website
Hub Angels Investment Group LLCVisit Website
Hudson Valley Startup FundVisit Website
iiM (Innovation in Motion)Visit Website
Investors of Color NetworkVisit Website
IrishAngelsVisit Website
IU Angel NetworkVisit Website
JaxAngelsVisit Website
Jefferson Corner Group LLC - BrookdellVisit Website
Jumpstart New Jersey Angel NetworkVisit Website
Kentucky AngelsVisit Website
Kern Venture GroupVisit Website
Knoxville Chamber of CommerceVisit Website
Kyto Technology and Life Science Inc.Visit Website
Landmark AngelsVisit Website
Lateral Capital ManagementVisit Website
Launch TennesseeVisit Website
Launchpad Venture Group, LLCVisit Website
Life Science AngelsVisit Website
Lubbock Angel NetworkVisit Website
Maine AngelsVisit Website
Maine Venture FundVisit Website
Mercy InnovationsVisit Website
Michigan Angel FundVisit Website
Mid-America AngelsVisit Website
Mid-Atlantic Bio Angels (MABA)Visit Website
Midlothian Angel NetworkVisit Website
Milwaukee Venture PartnersVisit Website
NA Capital PartnersVisit Website
Nebraska Angels, Inc.Visit Website
New Dominion AngelsVisit Website
New Mexico AngelsVisit Website
New World Angels IncVisit Website
New York AngelsVisit Website
Next Act Fund LLCVisit Website
Next Wave ImpactVisit Website
NextFab VenturesVisit Website
NJIT Highlanders Angel Network, Inc.Visit Website
NO/LA Angel NetworkVisit Website
North Bay AngelsVisit Website
North Carolina Biotechnology CenterVisit Website
North Coast VenturesVisit Website
North Country AngelsVisit Website
North Texas Angel NetworkVisit Website
Northern Michigan AngelsVisit Website
NuFund Venture GroupVisit Website
Nurture VenturesVisit Website
Ohio TechAngel FundsVisit Website
Oregon Sports AngelsVisit Website
OSEA Angel InvestorsVisit Website
Park City AngelsVisit Website
Pipeline AngelsVisit Website
PortfoliaVisit Website
Portland Seed FundVisit Website
Potential Energy DC Angel NetworkVisit Website
Princeton Alumni AngelsVisit Website
Private Investors ForumVisit Website
Puget Sound Venture ClubVisit Website
Purdue Angel NetworkVisit Website
Purple Sage CapitalVisit Website
Queen City AngelsVisit Website
Rebel Venture FundVisit Website
Reno Seed FunVisit Website
Rio Grande Valley Angel NetworkVisit Website
River Valley InvestorsVisit Website
Robin Hood VenturesVisit Website
Rochester Angel NetworkVisit Website
Rockies Venture ClubVisit Website
RTP Capital Associates, Inc.Visit Website
Saba InvestmentsVisit Website
Sacramento AngelsVisit Website
Sage Growth CapitalVisit Website
San Diego Angel ConferenceVisit Website
Sand Hill AngelsVisit Website
Santa Barbara Angel AllianceVisit Website
Sawmill AngelsVisit Website
Seattle AngelVisit Website
Seed Round CapitalVisit Website
SeedfundersVisit Website
SeedStep AngelsVisit Website
Seraph GroupVisit Website
Shasta Angel Group for EntrepreneursVisit Website
SideCar AngelsVisit Website
Sierra AngelsVisit Website
Silicon Catalyst AngelsVisit Website
Silicon Couloir Angel GroupVisit Website
SLO Seed VenturesVisit Website
Sofia FundVisit Website
SoundBoard Angel FundsVisit Website
South Carolina Research Authority (SCRA)Visit Website
South Coast Angel NetworkVisit Website
Southeast Minnesota Capital Fund LLCVisit Website
Southwest Angel NetworkVisit Website
SP3NW / WSUVisit Website
SprockitVisit Website
St. Louis Arch AngelsVisit Website
Stella AngelsVisit Website
SunCruces AngelsVisit Website
Sustainable Local Food Investment Group (SLoFIG)Visit Website
SWAN Venture FundsVisit Website
Tamiami Angel Fund IVVisit Website
TBD AngelsVisit Website
Tech Coast AngelsVisit Website
TechGROWTH OhioVisit Website
The Angel RoundtableVisit Website
The Emprise GroupVisit Website
The JumpFundVisit Website
The Launch Place Fund, LLCVisit Website
Thrive Investment PartnersVisit Website
Top Dr AngelsVisit Website
Traction CapitalVisit Website
Triangle Angel PartnersVisit Website
Trolley VenturesVisit Website
Tundra AngelsVisit Website
Underdog VenturesVisit Website
University City Science CenterVisit Website
Urban Capital NetworkVisit Website
US ANGELSVisit Website
VenCapitalVisit Website
VentureSouthVisit Website
VentureWellVisit Website
Veterinary Angel Network for Entrepreneurs (VANE)Visit Website
Virginia Innovation Partnership Corporation (VIPC)Visit Website
Virtual Angels NetworkVisit Website
VisionTech AngelsVisit Website
Walnut VenturesVisit Website
WBTangelsVisit Website
Westchester Angel NetworkVisit Website
Wharton Alumni AngelsVisit Website
Wichita Technology CorporationVisit Website
Wisconsin Investment Partners LLCVisit Website
Wisconsin Technology Council Investor NetworkVisit Website
Wolfpack Investor NetworkVisit Website
Women's Capital ConnectionVisit Website
xElle VenturesVisit Website

How Angel Investing For Startups Works

How Angel Investing For Startups Works

Angel investing is a form of private equity investing that involves investors providing capital to startups, which can include early stage companies as well as businesses that have reached the growth stage.

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Angel investors can be individuals or groups of individuals. They are typically experienced business professionals with a track record of success. They may have worked as entrepreneurs themselves or they may have been involved in early-stage ventures through prior jobs or investments.

Angel investors tend to be less focused on short-term returns than other types of investors and more interested in backing high-risk, high-reward opportunities.

Angel investing has grown significantly over the past decade as more startups are looking for funding beyond venture capital firms. According to the University of New Hampshire’s Center for Venture Research (CVR), angel investment activity increased by 200 percent between 2000 and 2008, with total angel investments reaching $23 billion in 2008 alone.


Angel Investors For Startups

Angel Investors For Startups

Angel investors typically provide their own capital and invest in small, privately held companies that have the potential for growth but generally lack access to traditional financing from banks or venture capital funds.

Investors look at startups’ business models and financial projections, but they also try to gauge whether the entrepreneur has what it takes to succeed.

For many startup companies, angel investors provide capital that can be used to cover initial expenses such as rent, legal fees and equipment purchases before they’re able to attract larger investments from venture capitalists (VCs). In return for that service, angels often receive convertible notes — debt instruments that give them ownership shares when a company goes public or gets acquired.

Angel investors typically provide their own capital and invest in small, privately held companies that have the potential for growth but generally lack access to traditional financing from banks or venture capital funds.

Investors look at startups’ business models and financial projections, but they also try to gauge whether the entrepreneur has what it takes to succeed.

For many startup companies, angel investors provide capital that can be used to cover initial expenses such as rent, legal fees and equipment purchases before they’re able to attract larger investments from venture capitalists (VCs). In return for that service, angels often receive convertible notes — debt instruments that give them ownership shares when a company goes public or gets acquired.


Best Angel Investing Platforms

  • Angel List
  • Angel Capital Association
  • Gust
  • Angel Forum
  • Angel Investment Network


What Should I Look For In An Angel Investor?

You should consider what you value most when looking for a prospective angel investor. Once you’ve identified your preferences, it will be easier to find the right person or people to help you scale your startup.

Relevant To Your Industry

To increase your chances of finding an angel investor for your startup, it’s best to start with those who have experience in your industry. For example, if you are a tech startup, reach out to investors who have previous tech experience rather than healthcare investors.
They’ll be more interested in investing and could serve as great advisors down the line.

Experienced Investor

When looking for an investor, you should consider his or her experience and accreditation. Accreditation does not necessarily matter, but look at how the investor’s prior investments turned out to help you determine what is best for you.

When you’re a first-time founder, it’s best to look for an angel with plenty of prior experience.

They Are Financially Stable

When you are seeking funding from an angel investor, they should be high net-worth individuals with no problem writing you a check for a specific amount. It’s as important to make sure that they can afford the investment without making demands for cash from you because they need it.

Mentorship Ability

As a startup founder, you have so much on your plate. You need help at times, especially with fundraising and finding the most talented people to join your team. An angel investor with connections to others and a record in the industry is one of the best people to ask for help.


Tips on How to Determine If an Angel Investor Is Right for You

Once you have identified some potential investors and determined what makes them a good fit for your startup, you are now ready to start comparing them and making the best decision for your unique needs.

Get references and check them.

To ensure that a potential investor is experienced, many startups limit their investors to those with accredited status. However, it’s more important to check references and follow up on previous investments made by the person before you make a decision.
By researching their past investments firsthand and learning about their approach, you can determine whether or not they will be a good partner moving forward. Plan to spend the time required to find a good investment partner — anywhere from one to six months of your time and effort will be rewarded with a profitable partnership.

Aligning your company's goals with those of your investor will be beneficial for both parties.

Before beginning a negotiation with potential investors, it is best to discuss goals and the future of the business. This should include the amount of capital needed, equity and decision-making control.

Establishing goals from the beginning will help you avoid confusion later on.

Get to know them and establish a relationship with them.

When you have a chance to discuss your goals with your angel investor, you can get to know them better, learn how involved they would like to be in the startup, and start to build a relationship with them.

It’s important to use this time to define what your relationship with them might look like. Some angels want to be involved and advise startups at every step, while others prefer to invest and provide counsel only when it is requested.

Treat your search as an important, two-way interview process.

Approach each call as an interview, and treat your startup as if it were a living, breathing entity. Do not become impatient with investors who can’t commit to your vision or schedule; instead, look for partners who will work with you to scale your business.

To help you ace this phase of prospecting, write down your notes from calls, prepare questions for every conversation, and do plenty of research about the person or company before you meet with them.


Angel Investing vs Venture Capital

Venture capitalists are professional investors who invest in startups that are seeking government funding, and they make those investments with the expectation of getting a good return on their money. They typically do not make these investments themselves, but rather give money to other investors who then use it to back startups.

Angel investors are a type of investor who provides funds to startups. They provide some funding and expertise to help the company grow, but they won’t take on the same level of ownership as VCs or PE firms typically do. The term “angel” comes from their role as an angelic guardian who helps entrepreneurs navigate the journey from idea to success.


Startup Accelerators & Incubators

Startup Accelerators & Incubators

Silent Rich’s comprehensive guide to startup funding and business financing options will help you explore the right funding options for your unique situation, whether you are a first-time entrepreneur or a seasoned executive.

FREE CONSULTATION

Incubators, or start-up accelerators, have existed since the 1950s. Today, incubators are often sponsored by private companies and public institutions like colleges and universities. Many incubators cater to technology companies. (One of the best-known incubators—Y Combinator—created Dropbox Inc., now valued at more than $10 billion.)

Business incubators offer companies, who are in the early stages of development, resources such as physical office space, shared services, expert mentoring, consulting services, legal counsel, and seed money (typically ranging from $10,000 – $150,000).

In exchange, an incubator is given equity in return.

It is difficult to get accepted into the most prestigious incubator programs. Acceptance rates for these programs tend to be in the single digits, so you might have an easier time getting into Harvard Business School than one of these premium incubators. Fortunately, there are hundreds of other incubators around the globe with varying eligibility requirements.

Incubators have a stellar record of helping start-up companies succeed. According to the PapaJohn Entrepreneurial Center, 60% of new businesses fail, but 90% of start-ups nurtured by incubators are thriving after three years and 87% are still in business five years after they launch.

Incubators are a great place to make connections with influential people in your industry. After your time at an incubator, you may walk away with 5 to 10 influential people who are deeply engaged with and eager to help your company grow.


Comprehensive Guide To Business Funding

Startup Financing Options to Fund Your Growing Business

Silent Rich’s comprehensive guide to startup funding and business financing options will help you explore the right funding options for your unique situation, whether you are a first-time entrepreneur or a seasoned executive.

FREE CONSULTATION

Before you begin your business, it’s essential to prepare. The first and most important step is to create a detailed business plan. This will help you get financing from investors and lenders. Include details about your product or service and your goals for the future in your plan. Be sure to also create a budget for start-up costs and ongoing expenses.

If you plan to borrow money to fund your business, you may want to build equity financing as well. This will ensure that you have an appropriate amount of debt and equity in your company.

Personal Credit Lines

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Angel Investors

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Venture Capitalists

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Business Loans

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Government Grants

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The world of startup funding can be a daunting one, especially when traditional business loans require one or more years in business.


Using Your Own Money & Credit Lines

When starting a new business, using your own personal savings and available credit lines can be a great way to initially get the business off the ground without having to give up equity or commit to repayment plans.

Another advantage to starting a business with a limited budget is the chance to learn frugality, which can lead to better spending habits as income, credit lines, and investment capital later increase.

When possible, it’s recommended that you take this route for as long as you can comfortably afford and it makes sense to do so.


Apply For Business Loans

A more straightforward way to finance your startup is to apply for a small business loan, but be prepared to submit detailed financial records and have a good credit history.

As you search for lenders to secure a loan through, it’s important to be upfront about your business strategy and how investment money will be used.

You can apply for a loan with:

  • Banks are a good option for people who have collateral and good credit, and who don’t need immediate access to cash.
  • Nonprofit Microlenders can provide small loans to startups and small companies that have been turned away by traditional lenders.
  • If you do not have collateral and need funds as soon as possible, you may apply for a loan from an online lender.
  • The Small Business Administration (SBA) is a government organization that helps fund loans for small businesses. Lenders working with the SBA often provide longer repayment periods for their clients’ loans.

Business term loans are a type of financing that can be used to pay for one-time investments in your business.

Before applying for online financing, writing a business plan is a good idea. Your business plan should include: financial statements, growth plan, mission statement, product and service descriptions and biographical information about the company’s leadership and staff.


Friends & Family

In the early stages of a startup, finding the right funding option can be stressful. Friends and family can be helpful sources of financing.

When borrowing money from personal relationships, you can often pay lower interest rates than you would at a bank. This can help reduce your overall debt level so that you have more cash to invest back into your business. However, it’s important to be aware that conflicts may arise when borrowing from friends or family members.


Securing an Angel Investor's Attention

Private investors can provide startups with the capital they need to get off the ground, but that funding comes with strings attached.

Angel investing is an arrangement in which an investor gives you funding in exchange for equity in your company. As a condition of the investment, the investor will often want to be involved in business decisions, and will be entitled to a percentage of proceeds if you sell your company.

In order to convince investors that you are capable of turning a profit, it is important to clearly outline your business plan. This includes the market opportunity for your products, as well as the potential for your company’s growth. Along with this, be sure to fully understand your marketing and PR strategy, as well as your startup’s financial numbers.


Start Setting Meetings with Venture Capitalists

As private investors, Venture capitalists are in the business of funding startups that they believe will potentially lead to a high multiple return in a future exit. Typically, venture capitalists invest in a limited partnership and make investment decisions through a management company called a commission.
Once a group of investors has decided to back a startup, they give money to the startup in exchange for a stake in the company’s equity. The members of this group usually look for startups that have launched their product or service and are ready to be scaled.
A few important things to keep in mind when preparing for VC meetings:
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Launch A Campaign On A Crowdfunding Website

When cash flow is tight or your company’s working capital needs to be improved, a crowdfunding campaign can help. These initiatives typically are held online on popular platforms, such as Kickstarter and GoFundMe, and raise small amounts of money from a large number of people.

To succeed at crowdfunding, try these tips:

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Government Grants and Subsidies

Government business loans and grants are available for any business, but there are many options to consider. As example, some programs focus on specific industries or demographics, others support women-owned businesses.
Some grants have been established to encourage minority businesses, or to help develop enterprise zones—areas in which the government wishes to foster economic growth. The government wants these locations to become more economically viable.


Startup Incubators & Accelerators

Startup incubators provide facilities, support and expertise to early-stage companies. You’ll get access to mentors and the tools you need to succeed while there, including expertise, seed funding, development resources, and often collaborative access to other startups within their program.
When researching startup incubators, it’s beneficial to speak with other founders who have been through the process. They can give you a better sense of whether you’ll be a good fit.


Use Peer-to-Peer Lending To Fund Your Business

Another option for financing a startup company is through peer-to-peer lending. Peer-to-peer platforms connect businesses seeking loans with business people or investors looking to lend.