A Comparison between Venture Capitalists and Angel Investors in the Startup Funding

Abstract

In 2021, many start-up companies raised a large amount of development funds, and many technology companies even listed at relatively high valuations. However, according to data analysis released by Crunchbase, venture capital in the global market will reach 445 billion dollars in 2022, a year-on-year decrease of 35% from 681 billion dollars in 2021. It is against this backdrop of slowing investment growth that this paper is written. The paper mainly analyzes the operation process and advantages and disadvantages of the two early financing methods of venture capital and angel investment, and on this basis summarizes how startups should choose the financing method that suits them. Each financing method has its own advantages and disadvantages. For start-ups seeking funding for development, they need to make the right financing choice depends on the ultimate goal of the company's development and adjusting the financing strategy according to the specific needs of different industries.