While this is not an all-inclusive list, it does provide a useful framework for different types of equity capital available. Within any of the specific groups below, expected rates of return, investment amount, time horizon and deal structure will vary depending on the strategy of the investor.

It will likely take extensive due diligence, phone calls and meetings to find the right investor at the most terms. More than that, it will likely take significant time and effort to develop and refine a business plan, projections and pitch book that best reflect and promote the investment opportunity.

The list is sorted from the stage of investment from later stage to earlier stage.

Mezzanine equity (Mezz equity)

•    Mezzanine capital is typically available to growth companies looking for short-term capital, in addition to senior debt to fund a management buyout, growth or acquisition financing
•    Typically for companies with $10 million+ annual revenues
•    Mezzanine capital is a subordinated or preferred equity instrument. The capital is secured by a subordinated claim on a company's assets
•    Return is provided by coupons and warrants
•    Mezzanine providers are often smaller investment firms focused exclusively on mezzanine lending.


Private Equity Groups (PEG)

•    Less than 10% of private equity funds will consider an equity investment of $1 million or less
•    Around 40% will consider an investment smaller than $5 million
•    Two-thirds are control investments and one third are non-control
•    PEGs manage equity capital in private companies for their financial backers (limited partners)
•    PEGs target high growth private companies in industries that provide a platform to roll-up, expand and grow organically, as well as through acquisition of add-on companies to the main platform investment
•    Mainly provide equity for recapitalizations, leveraged buy-outs and management buy-outs.


Venture Capital (VC)

•    Venture Capitalists typically favor early and expansion-stage companies that may not yet be cash flow positive
•    VC firms typically manage a pool of investment capital from institutional and high net worth investors
•    Limited strategic, managerial and technical support also available from VC
•    VC investment time horizon 3 to 7 years, at which point they are looking for an equity sale or IPO
•    VCs typically focus on industries that are highly scalable with low capital intensity
•    Favored industries healthcare, information and communication technology, electronics, semiconductors, healthcare and biotechnology.


Angel Investor (Angel)

•    Angel Investors are high net worth individuals (accredited investors) who collaborate with like-minded angels to invest mostly in fledgling companies, typically backing the idea and business plan of an entrepreneur
•    An Angel Network will typically have 6-8 meetings per year when they review a handful of presentations from entrepreneurs pitching their business idea
•    The investment is typically made for convertible debt or ownership equity
•    For those angels that are interested in investing, they may pool their funds into a special-purpose investment fund or LLC
•    The entrepreneur also benefits from technical strategic, operational, financial, marketing, legal or other professional support and advice from the angels.
•    Investment amount per deal is smaller than a venture capital firm, typically hundreds of thousands for an angel group rather than millions of dollars for a VC.

Sources: Both Private Capital Markets by Robert Slee and The Handbook of Financing Growth by Kenneth Marks were both great sources for this section.