What is the difference between a venture capitalist and a business angel?
Both provide equity capital for investment in new or expanding companies. But generally speaking, a venture capitalist is an investing institution - for example, an insurance company, a pension fund or another fund management organisation. Because they are investing money on behalf of other people, they are likely to have strict criteria - for example, on the type of business in which they are prepared to invest, the rate of return they expect, and so on.Business angels are private individuals who are looking to invest a lump sum on their own behalf, very often in a business to which they can make a non-monetary contribution too - for example, in helping with marketing or other management skills. Their financial resources will be more limited than those of the venture capitalists, but their approach probably more flexible.
Related Resources
in the Legal Information Centre
