4 ms·
Few Ways: 1 - Friends and Family loan you money. You. Or even the company. Loans are totally legit. THey dont get any upside, and you probably dont provide any
by Brushfire 16y ago
Few Ways:
1 - Friends and Family loan you money. You. Or even the company. Loans are totally legit. THey dont get any upside, and you probably dont provide any collateral, and they dont care becuase they trust you.
2 - They invest at the formation of the company.
3 - They invest as an active partner/member of the company. This means they might have liability that goes beyond just their invested amount. They may not know this. They trust you.
4 - They give you money, and you invest it "for them". See #1. This is essentially a personal loan.
Otherwise, if your uncle invests and wants legit ownership stake, he is no different than any other angel in the world who wants the same thing.
- petercooper 16y agoAha, thanks. Points 2 and 3 are particularly interesting. I guess they explain why you couldn't just bring in an angel investor as a "co-founder" (or, you could, but it'd have to be handled in an unconventional and delicate manner).