Many an entrepreneur is directed Friends and family When it comes to securing funds to start a business. In fact, “friends and family” has a place in the lexicon of entrepreneurship, along with “bootstrapped”, “Angel investors” and “Venture capital financing”.

Typically, the source from friends and family is common among young or young entrepreneurs. Serial entrepreneurs, who have had a lot of success, usually have bravery to believe they can self-finance their business or dirty record to approach the angels or capitalists of entrepreneurship.

It's only natural, especially for the young entrepreneur who is simply starting his or her entrepreneurial journeyto approach friends and family.

So I started my start as an entrepreneur. When I was six years old, my dad played Golf at Biltmore Country Club at Barrington Hills, Ill. Many times, I would ride in the Golf cart with him. I remember looking alive so that the players hit their balls in the dangers of water. They were not willing to get inside and get the ball. On the contrary, they would pull a new ball out of their bag, take a point and play.

This led to my first entrepreneurial idea. “Why can't I go behind the balls and sell them on the same golf player who hit the ball in the water?” So, I ran home and got my waders, a thermos cup and dixie and drew the table in the Golf Course. In two hours, I had made a surprising very $ 50. My father's membership in the country and being able to use the equipment he had bought, became my first unofficial investment in my business.

Resources, equipment and connections are all excellent substitutes for a current investment by a member of your Friends and family network.

Flash forward for this fall when I read for a study produced by researchers at Indiana University, which suggested that entrepreneurs who “often have no resources and funds needed to start a venture … to reach family and friends for support initial. ” The study continued to see “how the acceptance of funds from these individuals affects the preferences of an entrepreneur's risk.” I disagree with the premises. But I also believe that if you engage with “right” friends and family, entrepreneur's tolerance will not be affected.

Connected: Are you looking for initial capital? Ask your family and friends.

Do not choose a housewife

I know, this goes contrary to what I did with my father – but the last thing you need as an entrepreneur is someone who looks at your every move. Maybe you are being released, watching a show on television. You can feel the investor's energy, asking if there is something you can do to make the business more successful.

Choose someone who knows your industry

Let's say you are starting a business by referring to clients in legal firms. Ideally, finding an investor between friends and family who is a lawyer would be ideal. Not only will this investor know and appreciate your vision, but they can open the doors for starters and clients. As we know the entrepreneurs, taking it the first partner or CLIENTS It can be the foundation of future success. This qualification can be applied to someone who is more familiar than a friend, depending on how aware they are in the industry.

Engage with someone who has good credit

There are many reasons for this. First, someone with good credit There are resources. Investing them in your business will not leave them in an uncertain place, where if your business fights, then they fight. Second, having a good loan means that they have access to capital, which can support any needs of developing working capital. They can also support any opportunities you encounter to dramatically transform your business. More than ever, those with good loans have tremendous access to alternative funds.

Connected: How to finance your business through friends and family loans and crowds

Find an investor with an additional skill set in your business

You cannot effectively start a new business without expertise in some important areas, such as technology and marketing. Why not look for those skills sets between friends and family? They are likely to enjoy the opportunity to participate in the success of your venture. Maybe you can even sweeten the pot by offering a commission based on business success. After all is that by eliminating such costs, you will improve your chances of being a successful.

So what happened to the Golf Ball/Lemonade business? Well, the golf course did not take me much kindness for me by operating a lucrative business in their golf course, and they closed me. But not before I did six months before the allowance, which gave me the capital to start my future business.