If someone asks you to trade a significant part of your salary for equity, you're effectively investing in their company.
If someone asks you to invest in their company, approach it the same way as if they were asking you for cash - do your due diligence and ask lots of questions. I can't stress this enough - do your homework. Don't make assumptions that just because the founders are successful people that the company will be successful either.
Evaluate the same things a VC would look at - how does the founding team fit, what is the revenue model, burn rate, marketing strategy, who do they plan on staffing, what kind of investment do they have already, plans for raising another round etc. Don't be shy with these questions - the founders want you to trust them and be a part of the team and you have a right to know the answers.
Basically don't base your decision on a gut feeling and some ad hoc criteria, think like an investor before you invest.
If someone asks you to invest in their company, approach it the same way as if they were asking you for cash - do your due diligence and ask lots of questions. I can't stress this enough - do your homework. Don't make assumptions that just because the founders are successful people that the company will be successful either.
Evaluate the same things a VC would look at - how does the founding team fit, what is the revenue model, burn rate, marketing strategy, who do they plan on staffing, what kind of investment do they have already, plans for raising another round etc. Don't be shy with these questions - the founders want you to trust them and be a part of the team and you have a right to know the answers.
Basically don't base your decision on a gut feeling and some ad hoc criteria, think like an investor before you invest.