If you are doing that alone sure, but if you need to hire people and only have equity to pay them, things will get sketchy quickly without some kind of legal entity.
> On the other hand, since you have 25k, where else but in your startup can you invest your money and expect high profits? If anything, your family does not only rely on you but you can rely on your family to start a company. Your children depend on you showing them how to take risks and be successful.
High profits are the reward for high risk, and high risks do by necessity materialize very often - otherwise they wouldn't be high.
Also, high risks aren't necessarily rewarded with high profits - there are many risks that just aren't worth taking.
Those are the true lessons for the children: assess the risk, asses the profits, and decide whether taking the risk is worth it _for you_. Every person is different and has a different risk tolerance, there is no right answer to the question of whether a risk is worth taking.
A 25 year old joining a startup is taking a smaller risk than a 30 year old simply because they are investing less (their time is worth less, they have less to lose, etc.). The profits are also higher for a 25 year old: 1 year of failed startup experience at 25 can have a huge impact on your human capital long term - if you are a manager at 30, and jump to a startup that fails people will just think that you hugely miscalculated a risk. That might actually hurt your human capital.