It is no secret that getting a loan for the implementation of good business ideas in the bank is virtually impossible – bankers prefer to lend to the current and, primarily, a successful business. However, would the idea and the money will be found. One of the options for attracting investment – business angels. Who are Business Angels? Under the romantic name of 'business angels' hidden quite pragmatic investors who are willing to invest their own capital in the favorite business. Business angels are using venture capital investment vehicle – funding is provided for the long term without collateral or guarantors. Entrepreneur gets the required investments, business angels – its stake in the company.
Investor's goal is simple – wait until the maximum value of the company and sell its share to profit, many times greater than the sum of investments. It is easy to assume that the idea of private investment has come to Russia from the USA and Europe. In every European country there are thousands of business angels united dozens of organizations. Europe's largest network of angel – European Business Angel Network (EBAN) – consists of 62 associations of investors in 21 countries. Advantages and Disadvantages Business Angels The main advantage of business angels in front of a traditional bank loan – private investors are willing to take risks.
Unlike banks, they can provide a loan for business development and credit for the discovery business. Another advantage of working with the angels – they are engaged in the business, provide professional advice, offer support, because they have a stake in the success of the enterprise. However, the latter factor may be considered and disadvantage, because part of business angels in business administration denies businessman substantial share of autonomy. Another disadvantage of business angels are limited – the banks they are certainly much higher. However, if we are talking about small businesses and the investment up to a million dollars, the 'power' of business angels may be enough. How to find a business angel? If you have a decent idea for a business, finding a business angel is not so difficult. Today in Russia there are several organizations of business angels, the largest of which – the National Network of Business Angels 'Private equity' and the National Association of Business Angels. There are also smaller regional community of business angels. The capital is Moscow Network of Business Angels. Receiving money from investors – rather lengthy procedure. In order to get investment, you must provide a clear business plan or description of your project. In the 'Private Equity' documents can be sent by e-mail. If approved, the draft business plan will be posted on the organization's website and circulated to potential investors. By the way, if an investor is found, the employer will have to pay 'commission' 'private capital'. The so-called 'success fee' of 5% of the amount of investment.