While there are several key players in equity financing, angel investors and venture capital are the most popular funding sources. However, many mistakenly believe they are the same, but each play a different yet integral role in the equity financing process.
The infographic below explains the differences between angel investors and venture capital, including their entity type, funding stage, degree of involvement and expected return on investment, so you’ll know who to pitch when seeking equity financing investments.
Whether you’re pitching to angel investors or venture capital firms largely depends on the stage and industry of your business. In fact, not all businesses are suited for equity financing, as traditional businesses often prefer debt financing. To determine which method is ideal for your business, learn the pros and cons of both debt financing and equity financing.
If you feel ready to land equity financing, check out our tutorial on creating a pitch deck and our packet of documents needed to land and onboard investors. To learn more about the fundraising process, download our free e-book, The Complete Guide to Equity Financing.