Have you ever wondered how startups like Zomato or Razorpay raised money before becoming unicorns? Or how regular professionals — not just billionaires — invest in the next big innovation?
Welcome to the world of angel investors — early believers who take smart risks to support bold ideas. In this guide, we’ll unpack everything you need to know: who angel investors really are, how to become one in India, what motivates them, and how to get started with confidence.
Let’s start from the very beginning and dive into what is an angel investors.
What Is an Angel Investor?
In simple terms, an angel investor is a wealthy individual who invests their own money in early-stage startups — usually when no one else will.
They’re called “angels” because they provide crucial funding and mentorship when founders are just starting out and may not have revenue or proof yet.
Think of them as the startup world’s early believers — they take the biggest risk, often before VCs (venture capitalists) step in.
Key Traits of Angel Investors:
Who are Angel Investors and what are their traits. I know that they’re not banks or funds. Here’s what makes someone an angel investor:
- They invest in early-stage startups (often before VCs enter)
- Angel Investors use personal capital, not corporate money.
- They provide guidance, mentorship, and industry connections.
- In return of investment or money angel investors receive equity (a share of ownership).
- Typically invest amounts ranging from ₹5 lakh to ₹2 crore.
How to Become an Angel Investor in India
So, how do you become an angel investor? I know this question also came in my mind as well. Let me explain it in steps :
Step 1: Check If You Qualify
There’s no strict license required in India, but typically:
- You should have an annual income of ₹25 lakh+ or net assets of ₹2 crore+.
- Or you’re a seasoned professional, entrepreneur, or HNI (High Net Worth Individual).
Step 2: Learn the Basics
You need to learn the basics of investments such as :
- Equity vs convertible debt
- Understanding of Cap tables (who owns how much)
- Startup valuations
- Exit strategies (acquisition, IPO, secondary sale)
You can join workshops by Angel Network India (IAN), YourStory’s Investor and Masterclasses 100X.VC events to learn the basics.
Step 3: Join a Trusted Angel Network
These platforms help you find vetted startups, due diligence, and help manage paperwork:
- Indian Angel Network (IAN)
- LetsVenture
- Mumbai Angels
- AngelList India
- Venture Catalysts
Step 4: Start Small
- Invest in one or two startups first — ideally where you understand the industry.
- Ticket sizes can start from ₹2L–₹10L.
- Don’t just throw money — offer feedback and connections too.
Step 5: Diversify and Be Patient
Most startups fail. But the few that succeed can deliver 10X or even 100X returns. Don’t expect overnight success — angel investing is a long game.
Which of the Following Is Not an Angel Investor? (Explained)
You may come across this common query in startup discussions: “Which of the following is not an angel investor?” To clarify:
Angel investors — People like Ratan Tata or Kunal Shah who personally invest in startups. ❌ Not angel investors — Organizations like Accel Partners or SBI Mutual Fund. These are institutional investors, not individuals.
Why Do Angel Investors Do It?
Let’s be honest — it’s risky. So why do they still invest?
- High potential returns — get in early, exit big.
- Personal excitement — backing ideas they believe in.
- Giving back — helping first-time founders with experience and mentorship.
- Access to innovation — being close to what’s next.
Famous Angel Investors in India
Here are some names you’ve probably heard before — they’re all active angel investors:
- Ratan Tata – invested in Ola, Paytm, Urban Company.
- Kunal Shah – founder of CRED, invests in 50+ startups.
- Anupam Mittal – Shark Tank judge, Shaadi.com founder.
- Naval Ravikant – though US-based, widely followed in India too.
- Sanjay Mehta – runs 100X.VC and invests heavily in Indian startups.
Is Angel Investing Right for You?
If you’re financially secure, passionate about startups, and ready to play the long game, angel investing can be incredibly rewarding — both emotionally and financially.
Just remember: don’t go in blind. Learn, observe, join a network, and take your time.
FAQs
Angel investors provide early-stage capital, mentorship, and connections to startups. They invest their personal money in exchange for equity.
Generally, you should have an annual income above ₹25 lakh or a net worth of ₹2 crore to be eligible.
Yes. Angel investors are individuals using personal funds. VCs invest pooled money from institutions and typically come in at a later stage.
Technically yes, but it’s best suited for those with high income or net worth, business knowledge, and a high risk tolerance.
This is often asked in exams — the answer is: entities like VC firms, mutual funds, or banks. Angel investors are always individuals, not institutions.
You can join angel networks like IAN, LetsVenture, Mumbai Angels, or platforms like AngelList India to discover and invest in vetted startups.
Startups are risky — most fail. You may lose your entire investment, so diversification and due diligence are crucial.
Yes, if the startup succeeds and gets acquired or goes public, angel investors can earn 5X to 100X returns — but it’s never guaranteed.
