What is angel investment?

Thursday 28th August 2025

Last updated: 17th October 2025

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  • Cash flow challenge: My business needs funding to grow, but traditional loans are out of reach and I want to explore private investors who can also bring expertise.

  • Perfect for: Startups and early-stage businesses looking for funding and mentorship from experienced private investors.

Novuna helps businesses explore equity finance options like angel investment, comparing providers and guiding you to the right funding partners. We support you through the process to make sure you secure investment on terms that work for your growth.

 

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What is angel investment?

Angel investment is when high net worth individuals invest their own money into startups or growing businesses in exchange for equity. In addition to capital, many angel investors offer mentoring, contacts, and industry expertise to support business growth.


Unlike loans, angel funding doesn’t require repayments. Instead, investors take a share in your business and see returns when it grows or exits.


Benefits of angel investment

  • Access to capital without debt - you don’t have to make regular repayments.
  • Mentorship and expertise - many angels bring industry knowledge and valuable connections.

  • Flexible deal structures - agreements can often be tailored to the stage and needs of your business.

  • Signal of credibility - securing an angel can increase your appeal to other investors.

Challenges to consider

  • Loss of equity - you’ll give away a portion of ownership in your business.
  • Investor influence - angels may want a say in key decisions.

  • Finding the right fit - the relationship matters as much as the funding.



When to consider angel investment

Angel investment is best suited for businesses that:

  • Are early-stage or scaling quickly
  • Have strong growth potential but limited access to traditional finance

  • Value the mentorship and connections an investor can bring

  • Are comfortable with sharing equity to fuel growth

Alternatives to angel investment

If giving up equity isn’t right for you, other funding options include:

  • Business loans for growth
  • Invoice finance to unlock cash from unpaid invoices

  • Venture capital for larger, later-stage equity funding


How Novuna Business Cash Flow helps

Novuna supports businesses exploring equity and debt finance options. Whether you’re considering angel investment or alternative solutions, we’ll help you understand the best route, compare providers, and secure the funding you need.

We compare a range of providers to get you the right product and the best deal

Fast decisions. Flexible options. Funding over £2bn to more than 1,000 SMEs every year.

Complete the form below to compare and save with Novuna Business Cash Flow:

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