What is an Angel Investor?

Angel investors are also known as Business Angels. Angel investment is a form of equity capital investment. It refers to individuals or institutions with a certain net wealth. They make early direct investments in startups with huge development potential. A spontaneous and decentralized form of private investment. Angel groups or angel networks organized by angel investors themselves are currently expanding to share research results and focus on targeted funds.

Angel investor

(Investor type)

The group buying bubble burst,

Angel investors: Provide corporate funds and obtain the company

Lack of genuine innovation and technical content

Projects in the start-up period are high-risk, which is beyond doubt. Corresponding to high-risk, they must be hedged with high-yield opportunities in order to have investment value. Due to the lack of innovation soil in China, most entrepreneurial projects lack technological content, mainly some product ideas and immature ideas, so these projects cannot build high-yield guarantees brought about by innovation or technical barriers.

We often see some projects with potential high-yield opportunities. They are often based on information asymmetry, money and rights transactions, low-cost plagiarism and imitation, and involve gray areas. Such projects may be a good business for the parties, because profitability is not feasible.

1. Famous angels do not necessarily invest in good projects; because of their fame, it is easier to attract talents and projects, but they will be too picky when they are exposed to too many projects, which makes it easier to see potential projects.

2. Rich angels do not necessarily succeed; because rich people invest widely, the success rate is not high. Angel investment is an early investment, and entrepreneurs don't need much money. For example, Google and Facebook received angel investment of only 200,000 US dollars.

3. Angel investment is not necessarily high-tech and high-return; even if the annual return of investment over 20% is successful, too high pursuit of high-return risk will make the investment mentality bad. Therefore, there should be more choices in investment scope, and traditional industries also need angel investment.