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They all require a lot of money to get started. Most people don’t have even close to the amount of money it takes to start a small business, and so have to take out a loan or find funding from some outside source. The trick is to find the best source for your business. You always have a few options – whether that be by taking out a loan or seeking investors is up to you. When you’re looking for investors, you’ll come across the names of several venture capitalists, who invest their client’s money in startup projects.

Another option for the shrewd businessman or businesswoman, though, may be the kind of person known as a business angel. A business angel invests his or her own money in a company or business in order to buy part ownership. They will then wait for the company to make profits, and sell shares after your company has had a chance to grow. Sometimes, business angels will band together and pool their capital in order to invest in larger projects – if the company you wish to start is going to be expensive, you may wish to seek out one of these pools.

The next question is where you will find these business angels – and how you’ll let them know about your company. There are a few options here. For instance, if you already have a small business and are looking for investors to expand rather than to create something new, you may be able to find a business angel among your current customers – someone who knows and trusts you already, and has seen how successful you are and could be.

The Internet is another amazing tool when it comes to finding investors. Get online right now and log onto your favourite search engine. Type in “Business angels” and take a look at the listings that come up – you’ll be able to find investors all across the United Kingdom looking for all sorts of projects. Take a look at each, how much each is willing to spend, and whether that investor seems as if she or he would be interested in your company. If so, take down their name – once you’ve narrowed your choices down, you can start calling and deciding just who you want owning part of your company.

Banks and personal accountants often have contacts, as well. If you’re unable or unwilling to find business angels through the Internet, you can check in with your bank or with your accountant. They can look for you if you wish, or they may know some business angel investors personally and be willing to recommend one for you – remember, in this business as with so many others, it’s not what you know, but whom you know.

Remember, business angels are not venture capitalists. They aren’t working for stockholders the way a broker or investing firm does; rather, they’re spending their own money on things they believe in. As such, they will also be much more careful about what they decide to invest in. If you want a business angel investing in your business, you’re going to have to work hard to convince them. Come up with a good business plan and have some evidence you’ll make money, and you’ll go far every time.

These people are called business angels, also known as angel investors. They are people who have already made their successes in the business world and they understand the many challenges new businesses face. They are willing to help you in your new venture and ensure that you get your business on the fast track to success.

Don’t get the wrong idea though: they are not just going to throw some money at you and walk away; they will want to see a solid 5 year business plan, and a thorough list of projected income and expenses. They must believe in the business and be confident that it is a solid venture.

Here are five reasons you should consider investing with a business angel:

Start up capital: these people are willing to finance your business to get it up and running as quickly as possible.

Skills: they will freely share with you the skills they have learned throughout their own business ventures.

Contacts: they will give you access to all of their business contacts so you can start to build your own list. This alone is invaluable!

Interaction: they will have an active role in your business, both day to day and long-term. They have a vested interest in your business, after all.

They want to do business with you: business angels are everywhere and they actively look for solid business ideas and start-ups that they can help develop into successes.

No matter what country you live in, chances are you can find a business angel to help you. As stated above, make sure your business plan is solid – they won’t invest in flimsy ideas or plans that are written on a napkin.

If you have a strong desire to succeed, a great idea, and a solid plan, you should have no problem attracting a business angel to help in your venture. Do your research and make sure that you spend time with your investor to make sure you’ll be a good fit for each other. This is a business partnership; common sense and planning are essential.

I cringe every time I see one of these ads. Vultures are preying on honest business people who want to fund their businesses. Here are some ways to spot them:

1. “Only qualified investors see your business plan.” Yeah, sure. And who “qualifies” them? Have a friend try to sign up as an investor (that part is usually free). How is she “qualified”? Is there a background check? Does she submit a financial statement? Odds are that she will be asked to do nothing more than sign a statement that she has a certain net worth. That’s no “qualification” in my book. So who are these “investors”? Who knows. One could be your strongest competitor.

2. “You approve anyone who sees your business plan.” Okay. So what are you going to do to qualify the potential investor? Are you going to run a background check? ask for ID? ask for tax returns? or just be so happy that anyone wants to see your business plan that you jump on the idea? (That’s how these scams get away with charging thousands of dollars — too many entrepreneurs are desperate for funding.)

3. “It’s only $500 (or $300 or $100) to register.” What does it matter if it’s free? If it is diverting your time and energy and resources away from finding a viable investor, it’s not worth it.

4. “Your idea is great, but we need to put it into our format. This will only cost $800.” Don’t walk — run from these guys.

5. “Your idea is so great that we want to invest $2,000 in it.” (That’s after you spend $5,000 to put it into “their” system.) Do I really need to comment on this?

6. “Talk with a satisfied customer, or 2 or 3.” Here’s this entrepreneur who just got $2 million in funding, and he has nothing better to do than sell the web scam to you? Trust me, entrepreneurs who just get funded barely have time to eat, let alone talk.

7. “Look at all these written testimonials.” This is harder to disprove because the testimonials look so real — even the companies might be real. But unless the testimonials, and the companies, can be verified independently, I wouldn’t trust them. And I’ll lay odds that they cannot be verified independently.

There is one huge exception to this: ACE-Net (http://activecapital.org). This is more properly the Access to Capital Electronic Network run by venture capitalists, institutional investors and individual accredited investors. It was developed by the U.S. Small Business Administration’s Office of Advocacy to encourage the creation of a national marketplace for investors to find and invest in equity offers by small companies.

ACE-Net isn’t for all companies. Those seeking under $1 million will probably find the paperwork daunting. Those seeking over $5 million won’t qualify. There are special qualifications, and of course lots of forms to fill out — but nothing like the forms required for a formal initial public offering.

But for those who do qualify, it’s an amazing tool in raising financing. Spend some time with the website and the forms, and see if your local SBA office can put you in touch with another company that went through the process.

As with any investor tool, don’t rely exclusively on ACE-Net. Use it in conjunction with your personally developed targeted funding search. This, combined with an exceptional business plan, doesn’t guarantee success but it places your company head and shoulders above all the rest.