Vector of a briefcase filled with money. Represents angel investors and venture capitalists funding businesses.

How to Get Venture Capital and Angel Investor Funding

Securing angel investment or venture capital (VC) funding can be a game-changer for growing businesses. However, these forms of investment are often challenging to obtain due to their highly competitive nature. So what does it take to access these funding opportunities?

In this comprehensive guide, we’ll cover how to prepare for outside investment along with the intricacies of angel investment and venture capital. Let’s prepare you to connect with investors and get the funding you need to accelerate business growth.

What to do before seeking investors

Investment from angel investors or venture capitalists is rare for small businesses. If you believe you have a shot at landing this type of funding, here are the things you should consider beforehand.

Angel investment funding explained

An angel investor is typically an individual or group that has spare cash available and is willing to provide capital for a promising start-up or business expansion. They often invest much smaller amounts than venture capitalists and are willing to do so for businesses in earlier stages of growth. 

Check out our selection of resources to help you prepare to connect with these types of investors.

Venture capital funding explained

Venture capitalists are investors or firms that provide capital for businesses with high growth potential. Unfortunately, this type of funding only accounts for less than 1% of funding for US businesses. But, if you have a strong initial interest in your business and a solid roadmap for fast-growth or potential growth into a large company—you might want to consider it. 

Check out our growing selection of resources to help you out.

Investor templates and tools

Resources to help you prepare to pitch to venture capitalists and angel investors.

Venture capital and angel investors FAQ

Venture capital is a form of private equity financing for startups and small businesses that display high growth potential. It often includes funding, industry knowledge, strategic guidance, and networking in exchange for a percentage of business ownership.

Angel investment is funding provided by affluent individuals, called angel investors, to startups or entrepreneurs in exchange for ownership equity or convertible debt.

A notable example of venture capital is Sequoia Capital's early investment in Google in 1999, which significantly aided Google's growth.

Venture capital can be beneficial for high-growth potential small businesses, providing funding and strategic advice. However, it often involves relinquishing equity and control, as well as a required and predetermined exit from your business by either selling it or initiating an IPO.

Seeking funding from angel investors involves presenting a solid business plan, a persuasive pitch deck, and being clear on funding needs. Researching suitable angel investors before reaching out is essential.

Venture capital for small businesses is usually provided by venture capital firms, which manage pooled funds from multiple investors. Some corporations, wealthy individuals, or groups of angel investors may also provide venture capital.