Friends and Family are usually the very first capital providers you should look at. F&F often can be available even when a company is just in its "idea" phase. Other more professional forms of capital may not be available yet at this point as there might not be a product or prototype yet to validate the idea. Don't expect your parents to remortgage their house - mostly F&F investments range up to US$25,000 and can be in the form of equity or debt.
Angels are wealthy individuals, often entrepreneurs just like you, who are willing to invest anywhere up to US$500,000. Angels typically work as individuals or through a so called Angel Club and invest in startups and early-stage businesses. Apart from monetary investment, they are looking to be involved and can be great coaches at the enterprises in which they invest. Their investment is typically in industries with which they are familiar and can be equity or debt . Investment period on average 3-7 years.
You probably know this one already. Loans are simply an amount of money lent by one person or entity to another person or entity. In general, there is a interest payment (a annual percentage of the original loan amount), in return for the loan of the money and the total amount needs to be paid back in full at a certain date later in time. With loan agreements, other borrowing criteria are usually pre determined explaining the rights and obligations of the lender. Loans (or debt) can exist in many forms. Interest-bearing long-term debt, bank loans, accounts payable, personal loans, SBA loans, mortgages, bonds and so on.
Venture capital is almost always provided in exchange for equity in your company. Venture capitalists invest in small businesses which have reached break-even or will be doing so in the short term. Most venture capitalists are either wealthy investors or former investment bankers who invest as a group or company. Although they have a financial focus, they can also provide some managerial and technical expertise. In return, they definitley look for a bigger portion of equity and sometimes even a controlling (meaning more then 50% of your company) stake. Average investments range from US$250,000 up to US$5 million. A Venture Capitalist will look to invest for a certain period - most likely between 3 to 5 years.
Crowdfunding makes use of online and offline networks to attract informal and professional investors to invest in an idea or company. The idea behind crowdfunding is to generate investments from the masses, and get lots of small amounts of money from a large number of individuals. There are many forms of crowdfunding including donation based (meaning, you don't get a share in the company but something else), equity-based, revenue sharing, peer-2-peer lending and so on.
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