Angel Investors

This problem tests your understanding of early stage equity financing and the different sources of capital available to young companies. It focuses on who angel investors are, why startups seek them out, and how their funding role fits into the broader startup financing lifecycle. Interviewers ask this kind of question to see whether you understand basic capital markets terminology, the risk and return profile of private company investing, and the practical challenges startups face when they are still too early for bank debt or larger institutional capital. Candidates should be able to explain the purpose of angel funding, the stage at which it is used, and why investors at this point accept substantial uncertainty in exchange for potential upside.