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Throughout your journey at a growing startup, you’ll come across several types of investors.
The investor you raise from matters just as much as how much you raise.

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Types of investors

Angel investors write checks from their personal savings. Their relationship with you almost always comes through a warm intro.A lot of them are ex-founders or wealthy people who want exposure to startups on the side. Think Sam Altman, Peter Thiel, or that well-off ex-operator in your network who loves helping early-stage companies.

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Investment size

Most angels write checks ranging from a few thousand to $100K. Some high-profile angels can go higher.

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What do they invest with?

In earlier rounds, almost always through SAFEs. Later on, an angel will come in at whatever terms a lead investor sets.

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How long do they take to decide?

Fast, often the fastest of any investor type. A motivated angel can commit in a single call. In the worst case, a couple of weeks.

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How to find and get in touch with them

Almost entirely through personal relationships and warm intros. If you’re early and your network is thin, the fastest way to fix that is to get around other founders. The easiest ways in are through an accelerator, local startup events, or online places like Twitter.

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So who should you raise from?

Raise from angels if you want a low-complexity check, need a small amount to hit your next milestone, or already have a lead and want to fill out the round with people who bring domain knowledge or a useful network.

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Common questions

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Should I find a lead investor or take multiple smaller checks?

It depends on the situation and your preferences. Lead investors are harder to get meetings with, and require much more effort in pitching and entertaining due diligence. They also usually want at least 10% ownership and a board seat early on. A “party round” is different. You can raise $5k today on a SAFE, and if someone’s interested the same day at a different valuation? Easy, just have them invest through another SAFE. The problem is you could do this forever, and you might not be able to raise the full amount you want. You also won’t have any significant shareholders (i.e., 5-10%+), which could be both good or bad. If you don’t even have many investor meetings lined up yet, this choice isn’t something to think about right now.

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Is it true that if I get a top-tier lead, it could hurt me later on?

It can, and it often happens because of investor signaling. If you have a top-tier VC lead in your company’s seed round, and they don’t invest or lead your next round, it’s a signal to all other VCs that there’s something wrong, even if your company is in a decent position. Those other VCs are saying to themselves, “There’s an investor smarter than me who has more information, and they’re not investing. If that’s the case, I’d be an idiot if I jumped in.” And if one VC thinks this way, many others will too.

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What type of investors will help me most?

Ex-founders are usually the most useful. They can give you a real data point when you have a specific question because they’ve been there and done it before. VCs are a different story. Manage your expectations. Vinod Khosla, a very prominent VC and ex-founder, has said publicly that most VCs add negative value to their portfolio companies.