There are three main types of startup funding and how they work: angel funding, venture capital, and crowdfunding.
Angel investors are often early-stage investors who invest in startups for a share of the company or a percentage of the profits. The average angel investment is $50,000.
VCs are venture capitalists who invest in startups in return for a percentage of the company’s equity. The average VC investment is $2 million.
Crowdfunding is a type of funding where people invest money in startups through platforms like Kickstarter and Indiegogo. The average crowdfunding campaign raises $5 million.