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Capital sources: Venture capitalists
 Private
individuals and small groups of investors with excess cash and an
interest in financing small business are called venture capitalists.
They seldom invest in new businesses or grant outright loans. But
if you own a fast-growth company with good stability and need investors,
you may want to approach a venture capital firm. Your company should
have significant sales and a quality business plan before you expect
serious venture capitalists to get involved. Be prepared to surrender
part-ownership of the business in return for money.
Every state has venture capital groups comprised of
people with high cash flow situations who may be interested in your
business. Venture capitalists fit almost any description. Some represent
trusts and corporations, some have wealth from their own businesses
and all are looking for high returns on their investment. Finding
these people often involves networking with accountants, lawyers
and financial brokers.
Individual investors are called "angels." Entrepreneurs
looking for venture capital might try the U.S. Small Business Administration's
Angel Capital Electronic Network (ACE-Net)
and vfinance.com,
a venture capital resource library.
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