Reporters love the term "super angels." They use it at almost every opportunity they get, and sometimes even when they don't have the right opportunity for it. In my view, the terminology being used for early-stage investors is not as clear as it should be. I've talked about this on several conference panels, but figured it would make sense to do a post explaining my taxonomy of the early-stage investing world.
Friends and Family: Or sometimes referred to as the 3Fs for Friends, Family and Fools. This is probably the very first group that an entrepreneur may approach for some funding. These are "investors" who are investing in you -- not on the basis of your idea or the merits of your investment, but on the basis of a personal relationship. Sometimes this money comes with strings attached – strings in the form of expectations, which if not met can often hurt the relationship. The 3Fs invest their own hard-earned money, usually under $50K. They may or may not be accredited investors, and they don't invest regularly or often.
To read the full, original article click on this link: VC nomenclature and the investor spiral - The Term Sheet: Fortune's deals blog Term Sheet
Author: Manu Kumar
