A growing in popularity source of private capital is an investment angel. Originally a term used to describe investors in Broadway shows, "angel" now refers to anyone who invests his or her money in an entrepreneurial company (unlike institutional venture capitalists, who invest other people's money). Angel investing has soared in recent years a growing number of individuals seek better returns on their money than they can get from traditional investment vehicles. Contrary to popular belief, most angels are not millionaires. Typically , they earn between $60,000 and $100,000 a year. Which means there are likely to be plenty of them right in your backyard.

Excerpted from Start Your Own Business: The Only Start-Up Guide You'll Ever Need