This is a subscriber-only article. Join Entrepreneur+ today for access

Learn More

Already have an account?

Sign in
Entrepreneur Plus - Short White
For Subscribers

The Right Way to Ask Your Parents to Finance Your Business 4 things to consider before asking mom and dad for money.

By Michelle Goodman

Opinions expressed by Entrepreneur contributors are their own.


Alex Genadinik, 33, borrowed $20,000 from his mom last year to launch Problemio, a startup that makes mobile apps for small businesses. Carlo Cisco, 26, has taken $150,000 in convertible-note investments from his relatives since 2012 to expand Select, his New York City dining, travel and entertainment discount club. And over the past five years, Andrew Angus, 34, has borrowed from his mom $500,000 (half her net worth) to keep up with the exponential growth of Switch Video, his animated-video production company.

Family Money
Pros and Cons


Highly likely to say yes
Better financing and equity terms
Faster access to cash


Parents meddling in the business
Smirks fromindustry insiders
Lifetime of guilt if startup tanks

None of these transactions came without consequence or regret. "It might be the easiest money to get," Cisco says, "but it's probably going to be the most important money that you ever have, because you're not going to want to let them down."

The rest of this article is locked.

Join Entrepreneur+ today for access.

Subscribe Now

Already have an account? Sign In