3 ms·
> What's the difference between an "angel" investor and "begging from friends"? There is no difference. > I mean I appreciate the difference, but why couldn't
by anamax 17y ago
> What's the difference between an "angel" investor and "begging from friends"?
There is no difference.
> I mean I appreciate the difference, but why couldn't you put together a deal with an "investor" as if they were just a friend or acquaintance?
You don't understand. There's nothing special about friends and acquaintances. If you're taking money from folks, there are certain rules. The rules are a lot tighter for taking money from ordinary folk than they are for accredited investors. (Close family might be a third category - friends aren't.)
- _delirium 17y agoThere are some differences depending on whether you have a "pre-existing relationship" and whether you openly advertise. So under current law, at least, your uncle offering you $10k is different from putting up www.please-fund-us.com that solicits some random person you've never met to give you $10k.
- petercooper 17y agoYes, I don't understand, that's why I asked :-) The article mentioned begging friends and family for money (and this concept has come up in other fundraising situations), so I assumed there were certain loopholes for "personal" types of investment, and I wondered if this was codified, perhaps, or just an informal workaround. Is the difference, perhaps, that you don't necessarily give family investors official shares but just offer to pay back the money personally, etc?