Angel investment refers to financial backing from high-net-worth individuals - known as angel investors - who support early-stage businesses in exchange for equity or convertible debt. Using their own funds, they offer not only capital but also mentorship, industry connections, and strategic advice.
Often following contributions from friends and family, angel funding is the first significant external boost - enabling entrepreneurs to develop prototypes, conduct market research, and launch products before seeking larger venture capital financing.
Unlike venture capitalists who manage pooled institutional funds, angel investors use their own money and are typically former entrepreneurs or industry experts. Their speed, flexibility, and genuine belief in the founder's vision make them a lifeline for ambitious early-stage startups.