How to find an angel investor for your business
Make sure your start-up business has the right type of backer before signing a deal, says David Prosser.


Business angels are spreading their wings. The Angel Investment Network says last year saw a record number of people registering as angels – investors who are prepared to back start-up businesses with funding and their expertise – and the number of connections between angels and entrepreneurs rose 16%. That is good news for business owners looking for support for their fledgling enterprises.
Business angels come from a variety of backgrounds and may operate individually or as part of a syndicate, investing their own money in start-up ventures. They are typically prepared to back companies at an earlier stage than investors such as venture capital and private equity firms. And they often offer valuable insight, as well as cash, helping inexperienced entrepreneurs to navigate the path to growth.
Seeking support
If you’re looking for angels, there are several good places to start the search. The UK Business Angels Association effectively operates as the UK’s trade association, with 650 members who invested £2.3bn last year. The UK is also home to several prominent networks of business angels, who share opportunities and pool information: the most active of these in 2021 included Envestors, Minerva Business Angel Network and Cambridge Angels, says start-up platform Beauhurst. And entrepreneurs should not feel bound by geographical borders; the Angel Investment Network and Angel Capital Association, both US-based, have many members who invest on a global basis.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
With so many potential sources of angel capital, it makes sense to be discerning. Business angels will naturally want to conduct extensive due diligence before parting with their money, but this should be a two-way process. Entrepreneurs should be interviewing potential investors just as they are being interviewed themselves.
Founders will want to know that angels have the financial capacity to make the investment, but other qualities may also be paramount. Does a prospective investor have expertise in the area in which you operate? How much experience do they have of the investment process? Will they be able to provide ongoing advice to your business, acting as a mentor to the management team?
Hands-on or silent partner?
One particularly crucial question is how hands-on a business angel wants to be. In some cases, angels are looking to operate as more or less silent partners, leaving the entrepreneur to run the business on a day-to-day basis. Others are looking for much more involvement; they won’t want to take on an operational role, but they will expect to be consulted regularly and to be involved with key strategic decisions.
There isn’t a right approach, but entrepreneurs need to be clear about what they want. If you’re looking for active and regular support, a silent partner may not provide it; if funding alone is the priority, having a more involved business angel may cause tensions.
Given these nuances, it is important that entrepreneurs and potential angel investors take some time to build a relationship before sealing the deal – anywhere between three and six months is pretty typical. The conversation doesn’t have to be exclusive; there is nothing to stop founders exploring investment from several angels before making a final decision.
Sign up for MoneyWeek's newsletters
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.
-
Five years on: what did Covid cost us?
We’re still counting the costs of the global coronavirus pandemic – and governments’ responses. What did we learn?
By Simon Wilson Published
-
New tax year changes: how much will you have to pay in 2025/26?
The new tax year will start on 6 April, 2025. We look at how taxes and allowances are changing and how they will affect you.
By Holly Thomas Published
-
Five years on: what did Covid cost us?
We’re still counting the costs of the global coronavirus pandemic – and governments’ responses. What did we learn?
By Simon Wilson Published
-
Will Trump force the Fed to lower interest rates?
Opinion Markets are ignoring the risk that Donald Trump forces the central bank into reckless interest rate cuts
By Cris Sholto Heaton Published
-
London can lure Brexit-fleeing banks back to UK – but the City must move quickly
Opinion Many banks fled to Paris in the wake of Brexit but are now in full-scale retreat. The City should move quickly to lure them back, says Matthew Lynn
By Matthew Lynn Published
-
Protests erupt in Turkey after the arrest of president Erdogan's rival
Turkey's president has jailed his main political opponent, Ekrem Imamoglu
By Emily Hohler Published
-
What is the Mar-a-Lago Accord and why is it getting attention from Wall Street?
On Wall Street, there is talk that Trump's tariffs aim to make the world’s leaders come crawling to Mar-a-Lago, his Florida residence
By Alex Rankine Published
-
Spring Statement: Rachel Reeves 'must turn good intentions into effective measures'
Opinion Chancellor Rachel Reeves understands the economy’s structural problems but is unlikely to solve them, says Max King
By Max King Published
-
England's department stores return – but do they have a future?
Opinion The great traditional retail shops of Middle England have bounced back for now. Don’t get too carried away though, says Matthew Lynn
By Matthew Lynn Published
-
Can investors stay optimistic about Russian stocks?
Investors look to profit from Russia as Trump pushes for peace in Ukraine. But is it worth the risk?
By Alex Rankine Published