An angel investor is a wealthy individual that agrees to invest in a small startup company that has little access to capital.Typically, angel investors are entrepreneurs who may also be friends or relatives of the person starting the company. They believe in the company’s founders, as well as their business concept, and they loan the capital needed for the fledgling company to get off the ground, generally at more favorable loan terms than other lenders. Often, angel investors want their investment to remain private. In return for their support, angel investors usually receive ownership in the new company, often in the form of preferred stock. Angel investors are generally savvy business people who can offer crucial insights and expertise to the new company’s management, especially when the startup is in the angel investor’s niche. Angel investors are different from venture capitalists. Angel investors are usually individuals who want the business to succeed for personal reasons, as well as business reasons. Venture capitalists are partnerships that pool money from wealthy groups, investment banks or other entities in the hope of reaping a huge profit. Entrepreneurs who need funds to get their business going can benefit from an angel investor. But some angel investors may too closely monitor how their investment is growing and performing, which may not be what the entrepreneur has in mind.