Angel investing is a form of equity capital investing. The term originated from Broadway in New York and was first used in the United States in 1978. It refers to people with a certain net wealth who make early-stage direct investments in high-risk start-ups with huge development potential. It is a spontaneous and decentralized way of private investment. These people who make investments are called "investment angels". The capital used for investment is called "angel capital".

Suppose you have a good skill in making bread and want to open a bakery, but you don't have so much money in your hand. At this time, your cousin heard about it and happened to have some spare money. Your cousin knew you were a trustworthy person, so he decided to help you and gave you 200,000 as the start-up capital for opening a bakery.

At this time, your cousin's investment can be regarded as a seed round investment. A year later, your bakery is doing better and better. You want to open two more branches and expand your business. At this time, a boss who comes to buy bread every morning heard about it and thought your bread tasted very good. So he invested 500,000 for you, and you opened a branch smoothly.

When you are worried that you don’t have the funds to expand your business, the boss lends a helping hand to invest in you, like an angel coming, this can be regarded as an angel investment.

There are three main sources of angel investors:

1. A former entrepreneur;

2. The rich in the traditional sense;

3. Senior managers of large high-tech companies or multinational companies. In addition, in some economically developed countries, the government also plays the role of angel investors.

Many angel investors are entrepreneurs themselves. By being in this industry, they are very aware of the difficulties faced by entrepreneurs in the early stage, so they are willing to invest in start-ups. Angel investors are the best financing targets for start-up companies.

Angel investors don't have to be millionaires or high earners. They may be your neighbours, family members, friends, business associates, suppliers or anyone willing to invest in the company.

Angel investors can bring not only financial support, but also network support. If the angel investors are well-known, they can also bring credibility to the start-up through their famous status.

Angel investing is often a participatory investment, also known as a value-added investment. After many angel investors invest in start-ups, based on their own rich industry knowledge and experience, they are often willing to actively participate in the business affairs of the invested companies, and use their professional knowledge and experience to provide strategic decisions, provide consulting services, help start-ups recruit managers, assist with PR, design exit channels and organize corporate exits, etc. However, different angel investors have different attitudes towards post-investment management. Some angel investors will actively participate in it, while others are willing to act as hands-off shopkeepers after investment.

（Writer：Picy）