How do I get started as an angel investor?
How do I get started as an angel investor? Usually, meeting the standards of being an accredited investor is a prerequisite for becoming an angel investor. This means that your earned income must be $200,000 or more for the past two years ($300,000 with a spouse) or your net worth, alone or with a spouse, must surpass $1 million in investable assets.
Why would an angel investor invest in a startup? Angel investors are typically the first investors in high-growth start-ups providing much-needed venture capital. Investing early means two things for angel investors; higher risk but more importantly – the potential for much higher returns.
What do angel investors need to know before investing? Investors will absolutely want to know how their capital will be invested and your proposed burn rate (so that they can understand when you may need the next round of financing). It will also allow the investors to test whether your fundraising plans are reasonable given the capital requirements you will have.
How much money should you have before angel investing? Angel investors are often accredited investors, which is a designation that requires a minimum net worth of $1 million, at least $200,000 in annual individual income or at least $300,000 in annual joint income (see the Securities and Exchange Commission website for details).