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I talk to a lot of angel investors, and I talk to a lot of people about angel investors. But in writing about the topic, I've uncovered a broad distinction between angels that may be worth noting. For example, you may not think of your dentist as an angel, but many medical professionals make random investments that could classify them as an occasional angel, or belong to an active angel group that might put them in the category of a professional angel.

So we'll start with the occasional angels, which generally comprise people who make up a friends and family round and may or may not be accredited investors. Also in this category are investors who may do one smaller investment a year, usually of less than $25,000, as part of a small, regional angel group.

Those who invest between $25,000 and $250,000, generally in two or three deals a year (although some do much more), and are fairly close to professional investors can be called professional angels, and they make up the majority of angel investors. They can belong to angel groups and/or may be former entrepreneurs who have cashed out and want to stay involved in the technology community. With the number of high-profile acquisitions in the past few years, these angels have proliferated and are funding a lot of the Web 2.0 deals. Names in this sector include Caterina Fake, Reid Hoffman, Ron Conway and Esther Dyson.

The higher-level angels (they have been called "archangels") are folks like Bill Gates, Paul Allen and other name-brand entrepreneurs who have the money and inclination to fund entire Series A rounds or put millions into a company if it catches their fancy. It's hard to get to them, and the more likely route to their money is through their investment firms, but having their participation guarantees your startup will get noticed.

With angels putting $11.9 billion into startups during the first half of this year, according to  the Center for Venture Research at the University of New Hampshire, it's an investor class that deserves some extra attention and perhaps a little more definition. - Stacey Higginbotham

See Oct. 3 post from Tech Confidential


 

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