DEFINITION OF 'Angel investor (business angel)'
Angel investors are private investors who provide finance and support to early-stage businesses. The term derives from "Theatre Angels" who were private investors that provided the initial capital needed to get a new theatre production onto Broadway and in exchange received a share of the production's earnings.
Angel investors are often wealthy individuals who have entrepreneurial experience themselves or specific industry experience that is shared with the company being invested in.
They offer various forms of finance including shares or other securities that represent an ownership interest in a company including equity, debt and variations of the two.
Angel investos are sometimes referred to as business angels or, simply, angels.