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entrepreneur.com— “I need to learn how to approach friends and family for startup financing. Can you provide a short list of resources or references for me?’
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entrepreneur.com— “I need to learn how to approach friends and family for startup financing. Can you provide a short list of resources or references for me?’
Basil Peters, over 3 years ago
Great question. As an angel investor, I regularly see companies that have only been funded by friends and family.
In many cases, the investability of these companies has been seriously impaired by mistakes made during the Friends and Family financing. Often, the entrepreneurs have unintentionally been unfair to their friends and family by selling shares at unreasonably high valuations.
To help entrepreneurs, and their friends and family, avoid the common pitfalls, I have been working on a series of posts in my blog on Best Practices for Entrepreneurs and Angel investors at http://www.AngelBlog.net. An overview of the legal requirements of Friends and Family financings is also included. I hope this is helpful to your readers. Basil