As a venture capitalist, I get approached several times a day by entrepreneurs looking to raise money. One of my typical responses is, ‘You shouldn’t be talking to me; you should be targeting angel investors.’
The source of this confusion varies: Sometimes it’s a misunderstanding of the different roles and expectations of a venture capitalist vs. an angel investor. Other times it’s a lack of clarity on the part of the entrepreneur regarding what he or she wants to accomplish with both the business and the financing. Regardless of the source of the confusion, here are a few guidelines for determining whether you should be approaching venture capitalists or angels for your financing.