1, definition
Angel fund refers to the funds invested by investors in start-ups and is a kind of venture capital. Investors often invest in start-ups with great potential but high risks in order to get higher returns. Generally speaking, such investors are individuals, and the investment amount will not exceed 500,000 US dollars. The purpose of their investment is to get higher returns, not to carry out management control.
2. Features
Angel fund is characterized by small investment amount, short investment cycle, high investment risk and high return on investment. The investment amount is small, generally within 500,000 dollars, the investment cycle is short, generally 1-3 years, and the investment risk is high, because the investment in start-ups has a high return on investment, generally 2-5 times.
3. Types
According to different investors, angel funds can be divided into individual angel investment, angel investment team and angel investment fund. Personal angel investment refers to individual investors investing in start-ups, and the investment amount generally does not exceed 500,000 US dollars; Angel investment team refers to an investment team composed of several individual investors, and the investment amount is more than 500,000 US dollars. Angel investment fund means that angel investors invest in an investment fund, and the investment fund invests in start-ups with an investment amount of more than 5 million US dollars.
4. Advantages
The advantages of angel fund are small investment amount, short investment cycle, high investment risk and high return on investment. The investment amount is small, generally less than 500,000 dollars, the investment cycle is short, generally 1-3 years, and the investment risk is high, because the investment is in a start-up enterprise, and the return on investment is high, generally 2-5 times.
5. Deficiencies
The disadvantages of angel fund are high investment risk, uncertain investment return and little investor control. The investment risk is high, because the investment is in the initial stage and the return on investment is uncertain. Because the investment is in a start-up, investors have less control, and because the investment is small, investors can't manage and control the start-up.
As can be seen from the above, angel fund is the fund for investors to invest in start-ups and is a kind of venture capital. Investors often invest in start-ups with great potential but high risks, so as to get higher returns. Angel fund has the characteristics of small investment amount, short investment cycle, high investment risk and high return on investment, but it also has the disadvantages of high investment risk, uncertain return on investment and less investor control. Therefore, investors need to be cautious when investing in angel funds to avoid investment failure.
This paper expounds the definition, characteristics, types, advantages and disadvantages of angel fund in detail, and points out that angel fund has the characteristics of small investment amount, short investment cycle, high investment risk and high investment return, but it also has the disadvantages of high investment risk, uncertain investment return and small investor control. Investors should be cautious when investing in angel funds to avoid investment failure.