well, maybe I am being a bit nieve, but generally speaking it takes one roughly 6 years to double their money and that is investing primarily in stocks that can average 12% over the 6 year period. Any initial down years also make the requirement for the average return to be higher, due to the loss of principal, to double your money in 6 years........ Yes, this carries an inherently higher risk but the return is also almost 300% more than you general investment with the slightly above average stock market risk to generate the appropriate returns................................ So, the short answer is yes I do feel it is commensurate with the amount of risk taken, but again that is my opinion and may or may not be the opinion of the investor.
What are your thoughts?
When comparing the risks of a new business and the stock market, remember the liquidity factor. (you can sell stocks at any time while there is zero liquidity in a start-up)
You also need to address the "perceived" risks. (for example - the ability of the "team" to execute the plan as well as the "strength" of the plan) How would you rate yours?
Te1280,
Remember investors also invest in the person (founder), not just the product.
Ask yourself - would you invest in someone who has bad credit, with no money, and seems who doesn`t understand investment in general?
If you (or anyone) want to get investment, the number one thing is to make yourself "turstworthy". Get your credit score up. Get your own finances in order. Have some savings - so you can tell investors "I am putting my own savings into this venture".
Otherwise, you have no chance to get any investment.
Just being honest.
From my experience, the question of "how much of your own money do you have invested?" is actually related to the question of commitment. Investors want to feel that you are committed to the project - for the long haul.