One of the best ways for anyone to make money is to loan money. It's a great way to make money especially when you're investing in new start-up businesses. The only catch, not everyone qualifies to invest in a start-up company.
Angel Investors have minimum wealth requirements to legally make an investment in a new company. That amount is something like $250,00 income per year for the last two years or they must have at least $1,000,000 net wealth and the investment is less than 10% of their net worth. Still, you can make money when you loan money to new businesses even if you don't meet those requirements.
If you are closely related to the principle investors, you may be able to get a waiver around the restrictions. Friends and family are often allowed to make money when they loan money to start-up companies operated and owned by friends and family. Just be careful because start-up companies often fail, no matter how good they look. The cash you invest needs to be an asset you can easily part with. You should never invest dollars that you have to have returned or it will cause a future hardship.
Many investment allowing you to make money when you loan money start as little as $5,000 and go up from there. Ideally if you make that $5,000 investment, you should have another $5,000 investment liquid to add to your investment in future stock purchase rounds. Most venture capital companies purposely do this to help the companies they invest in because they almost never have enough capital when starting out and need to come back for more.
There is another opportunity to make money when you loan money that I've done before. A company called Prosper puts together loans for people who need cash for various reasons from starting a business to consolidating loans. You put your liquid dollars into Prosper and then pick the loans that you would like to participate in. That gives you the opportunity to be the bank and get a great return while reducing your risk on your investment.
There you have it, a couple of ways you can make money loaning money and help people who are looking to launch their new business.