Every Startup Need the Right Investors

Accredited Investor
This is an SEC (or any local similar bureau) definition that define the minimal requirements from an individual to be able to invest in private companies. In the U.S. for example it’s: An individual must have a net worth of at least $1 million (excluding the value of their primary residence) or have had an income of at least $200,000 (or $300,000 for married couples) for the past two years, with the expectation of earning the same or higher income in the current year.

Angel Investor
An individual, investing his own money. This type of investor usually invest in the earlier stages of a startup and usually put in a relative smaller check size. The Angel Investor usually invest faster, has a higher risk tolerance and works based in feelings and trust (please keep in mind that these are general descriptions, and each person operate a little different).

Super Angel
Still an individual investing his own money, but one that makes more investments per year and is able to write larger checks. Due to their experience, Super Angels usually invest more systematically and has more processes and filters that help them make their investments decisions.

Accelerator / Incubator Programs
These are programs (typically 3-6 months long) where a startup which qualify goes through an intensive acceleration (hence the name) process designed to help early stage startups grow. There are specific accelerators based on geography, industry, stage, inclusion etc. Each program has its own rules and guidelines. Most will give a small check and take 7-8% equity (may differ between programs). 

Micro VCs
This is the first class of professional investors. They invest out of a money pool raised from other investors (called LPs or Limited Partners). This type of investor should have strict processes for investment decisions and a structured due diligence process. They are called Micro since the fund size is relatively small, which means they tend to invest in earlier stages and write smaller checks.

VCs (Venture Capitalists)
These are the professionals when it comes to startup investments. They have teams of people working for them and they invest funds they raise themselves from LPs (just like their micro version). Each fund have a structured due diligence process, investment committees, general partners, regular partners and even analysts. They are the ones putting in the larger checks, usually investing in the growth stages.

Corporate VCs (or CVCs)
Similar the the previous VCs, these are professional organizations that invest in startups. The difference between the two is the source of the funds (which determine their investment criteria and other decisions). The CVC is usually funded by a single corporation making their investment focus on startups that can add value to the corporation.

Family Offices
This is another class of professional investors. A family office is usually funded by a single (or a small number) of wealthy families, managing their private money.

Fund of Funds
These are the whales of the investment industry. They don’t invest directly in startups, they take on the role of LPs in smaller funds.

Institutional Investors
These are the large pension funds, universities and other large pool of public money managers who allocate a portion of their portfolio to high-risk investments like being LPs for other VCs.