In exchange for money from investors, you must give them a portion of ownership and control in your business. Typical investors are friends and family, angel investors, venture capitalists and crowdfunding.
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Crowdfunding is a very new type of funding which takes advantage of the power of the Internet and allows the many people to pool lots of smaller sums of money for a business in which they believe.
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Your friends and family may choose to invest in you through a gift, a loan or an equity investment in the business - whatever means, make sure you have a signed document or letter saying the money was given and what terms were agreed upon.
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Angel investors are high-net-worth individuals who get an equity stake in return for their financing. They expect to make a profit and usually have business expertise they share with you to help your company grow.
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Venture capitalists take equity in your business in exchange for big financing. These investors typically only do multi-million dollar deals and expect a big return on investment.
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