Business angels and new businesses: a match made in heaven?

Business angels can be a crucial resource for fledgling firms, helping them survive and thrive. For investors, the risks are high, but the rewards can be spectacular, says David Prosser

Business angels concept with blue background, shopping card and ceramic angel
(Image credit: Getty Images)

For entrepreneurs, the plateau effect is an all-too-common phenomenon. They get their business up and running, prove to themselves that their big idea works, and even begin to make some sales. Then they face some harsh realities. How will they turn this early-stage business into a commercially viable enterprise when they lack the funding, the experience and the connections to make such a leap? 

Stuck on this plateau, as many as 60% of new UK businesses fail in their first three years. But for a growing number of entrepreneurs, there is now help at hand. The UK is home to 10,000 active business angels seeking to support these early-stage ventures. 

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David Prosser
Business Columnist

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.