Business Loans From Family & Friends – How to Ask, Make it Legal, & Make it Work
The first thing I noticed about "Business Loans From Family & Friends: How to Ask, Make It Legal, & Make It Work" by Asheesh Advani was that the book had a foreword by Richard Branson. Having invited the founder and chairman of the Virgin Group, I figured if he'd approved it, I'd take a look. I was not disappointed.
The book covers a topic that you do not see that often. Sure, there are books on entrepreneurship out there that suggest a source of funds may be family and friends, but this book delves into the subject matter at a much greater level and provides a lot of practical advice on the topic.
The book is divided into eleven chapters with the following titles:
Why Raising Money From Family and Friends Is For You and Yours
Checking Out All Your Financing Options
Basic Legal and Tax Issues of Business Loans From Family and Friends
Deciding Who to Ask for Money
Preparing Your Business Plan and Your Fundraising Request
Deciding Interest Rate, Repayment Schedule, and Other Loan Terms
Drafting a Loan Request Letter
Making the Kitchen Table Pitch
Preparing a Promissory Note, Security Agreement, and Other Loan Documents
How to Be Your Own Investor Relations Department
Handling Gifts From Family and Friends
For anyone who is looking for small business financing, this book may have just the information you need. There is a lot of useful information here, and one of the best things I believe is that it gets the reader thinking about costs and sources of money for their business venture.
The book also comes with a CD ROM that contains a number of forms and worksheets. These are also found in Appendix B. Sample promissory notes, security agreements, and letters are a few of the documents included.
Nolo does an excellent job at making legal information accessible to everyone, however, depending on your situation, you may still want to seek out legal advice regarding any loan agreement you enter. However, this book is a great start and a very good resource for anyone who is looking to finance a small business and needs to raise money from family or friends. Very good resource for small business financing!