Bill Barber, President of the Southern California Chapter of Maverick Angels, explained two important concepts about Angel investing.

From the company owner’s perspective, there is a heirachy of capital acquisition possibilities: 1) self-financing, 2) Family, Friends and Fools (The Three Fs), 3) Angel investing, 4) Venture Capital investing, 5) bank loans (which are practically non-existent, at the moment) and 6) initial public offering, or equity investing.

From the investor’s point of view, there are several Return on Inventment possibilities. Bill preferred not to call them “Exit Strategies” because that term is too limiting. They are: 1) being acquired by a larger company, 2) Initial Public Offering (IPO), 3) Cash Flow in the form of dividends or profit sharing.

Listen to the entire interview below.