Question

From the following list of features of business investors, identify the correct option to describe the angel investors accurately.

Features:

1. Individuals who have the knowledge, expertise, and funds that help start-ups match up to industry standards.
2. Investors who provide proactive advice, guidance, industry connections and mentoring start-ups.
3. Investors who have a continuous involvement in the business after making the investment.
4. Investors who have a legal right to repayment of the capital, irrespective of the success or failure of a business.

Options

• (i) and (ii)

• (i), (ii) and (iii)

• (iii) and (iv)

• (ii), (iii) and (iv)

Answer 1

(i) and (ii)

Explanation:

Angel investors are individuals who invest their own money in promising start-ups and bring knowledge, expertise, and valuable industry connections. They often provide mentorship and guidance to help the business grow. However, they do not stay continuously involved in the business (that’s typical of venture capitalists) and have no legal right to repayment if the venture fails.