The Pros and Cons of Raising Money from Friends and Family

I think we agree, but to elaborate; The point I'm making is that this shouldn't be the case (and needn't be a joke). I've raised funds from "friendly" sources a few times. In each case it's been made clear that the investor should be doing so doing so to make money. If they lose their money it's because they invested poorly, and it was their decision. They are asked to weigh up their other investment options such as the stockmarket and property and make a call.

If friends and family want to 'help out' then investing is probably not the vehicle. They should lend money. There's will be less upside for them but the debt will stand if the venture fails.