(MONEY Magazine) – William Wetzel Jr. of the University of New Hampshire, an expert on the business-funding benefactors called angels, talked with MONEY's Elizabeth Fenner about tapping this key cash source.

What will an angel want to know about me? Mainly that you and the other managers of your company have integrity and competence, which you could demonstrate by providing six personal and professional references, for example. But angels are also motivated by nonfinancial considerations, like wanting to create jobs or develop socially useful technology. So be sure to mention any such benefits that your enterprise may entail.

What should I know about an angel? Get a resume and two or three references, especially the names of other entrepreneurs he or she has financed. Then call them to see whether they were satisfied. Ask how much technical or management guidance the angel provided and whether it proved helpful or just meddlesome.

How much money should I ask for? As much as you need. Angels usually invest $25,000 to $50,000 each, but you can get more by dealing with five or six angels at once, since they sometimes prefer to invest as a group.

How should the investment be structured? It's best to give up straight equity -- a percentage of ownership of your business, represented by common stock -- rather than, say, a loan that can be converted into stock. The simpler the deal, the easier it will be to raise money from other investors later. And nail down the investor's exit options early. If he expects to cash out by selling securities back to you, be sure the terms are laid out in the agreement and tied to the firm's performance.

Can I swing the deal alone or should I get help? You will need a lawyer familiar with state and federal securities law. Your attorney should also be experienced in negotiating venture financing so he can help you get the best deal. Legal fees can run $10,000 to $20,000 for an uncomplicated $500,000 angel transaction -- but if your lawyer saves you even 5% or 10% of your company's equity, that cost will be worth it.