A retired CEO investing and mentoring in a start-up represents an angel investor, who offers funding and expertise to the business during its early and risky stages.
A retired CEO who invests in a start-up and acts as a mentor to the employees is an example of an angel investor. Angel investors are affluent individuals who provide capital for a business start-up, usually in exchange for convertible debt or ownership equity. These investors typically bring more than just money to the table; they also contribute their expertise and experience by mentoring the management team, helping the firm overcome the risks associated with imperfect information about the business plan and prospects during its early stages.