There are few small businesses that possess the credit rating or collateral to secure a conventional bank loan. Now, in the midst of the pandemic lockdown, as small businesses and startups are struggling to get financing, entrepreneurs are seeking alternate sources of capital to launch or shepherd them through this economic crisis. Now, more than ever, it is imperative to search for financing through modern networking tools. During the current funding ecosystem, small businesses are looking to connect with investors of all types; and social media technology is coming to the rescue.
Angel / seed investors finance startups in exchange for equity in a company. Unlike VC firms, however, angel / seed investors are private individuals (or a group of individuals) investing their own money–providing capital for a set fraction of the company (usually no more than 20%). And while VCs tend to operate in the $2 million-plus range, angel / seed investors usually offer only up to about $1 million…and as little as a few tens of thousands of dollars. Examples include the Adirondack Foundation, who partnered with the United Way in upstate New York.