Question: I have designed a company that is ready to deliver educational software programs. I've invested about $1.5 million mostly from savings, but I did borrow some money from my parents.

I have lined up a distributor and believe we are well-positioned to launch, but we need another $1 million. I read your column about bank financing for small business and was encouraged. But I would like to know if there are any other alternatives.

Answer: I'm not trying to be glib, but you might want to find an angel. Not necessarily one from heaven, but an angel investor, a quasi-venture capitalist who will fill your funding gaps so your business has a fighting chance.

Unlike banks, angels can be operating partners who will give you advice and introductions to new clients that will open doors and get you new business. They will have a vested interest in your success, so choosing one is like finding the right partner.

Angels come in varied personalities, styles and backgrounds. Some are entrepreneurial, those that manage their own successful companies. They will take more initial risks and as the company progresses, might even invest more money over time. They usually are looking for businesses that fall into their general area of expertise.

Managers who have recently left Fortune 1000 companies for various reasons are also potential corporate angels. While they're looking at ways to invest their money, they're also looking for a new management position. So if you're not ready to give up the helm, you might want to think twice before accepting them as investors.

Retired and independently wealthy business people are enthusiastic angels. But they're really looking for businesses that they will enjoy working with, more like a hobby than a career path.

Then there are the professionals doctors, lawyers, accountants who would like to invest in young companies that they have some experience in, like doctors who like to invest in medical instruments and generic testing, etc.

Whatever investor suits your needs, make sure you choose wisely. Be careful of the micro-managers who have a lot of money, have built successful businesses in the past, and would like to take over your company.

Make sure there is a good chemistry between you and the investor. That's almost as important as raising the money.

If you don't find a right angel investor, instead of having a deal that was made in Heaven, you'll find yourself in entrepreneur's hell.

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