What should every interest that invest in a business do?

This blog will be quick because I have a new client to meet this evening. I am meeting two investors that are investing in different business ventures. A common mistake is solely investing in the membership or shares of a company or an LLC. This is a mistake because the shares or membership interests of an LLC are worthless when the business becomes a distressed business.

At a minimum, a security interest should be signed and secured. It is best to have a business owner's house as collateral. Second, each business owner should sign a personal guarantee in case the business goes wrong. Third, the investors should get paid back first in case the investment goes south.

Sean Robertson is an corporate and asset protection attorney in downtown Chicago, Illinois. Sean Robertson has extensive experience representing business owners and venture capitalists that want to invests in an entrepreneurial or start up business. Sean Robertson can be reached at 312-498-6080 or Sean@RobertsonLawGroup.com.