Investigate the investor before accepting the money

Speak with founders who know the person after a deal closes. Ask about difficult periods, disagreement, communication, and follow-on decisions. Learn whether the investor was useful when progress disappointed. Success stories alone do not reveal that behavior.

Examine relevant experience, useful access, network, and reputation. A strong reputation can open doors, but it does not settle personal fit. A local network may not support a global objective. Check the contribution against the company you intend to build.

Clarify involvement. A good investor can help without taking over daily operations. An experienced entrepreneur who invests may still want to run the company. Agree how support and decision rights should work.

Ensure that the investor understands the possibility of losing the money. A personal relationship does not reduce the risk. Treat money from people you know with the same seriousness as other capital. Do not accept an investment whose downside the person cannot understand or bear.