NEW YORK – (DGIwire) — According to Webster’s New World Finance and Investment Dictionary, an “early stage investment” is “the financing provided by a venture capital firm to a company after it has received its initial, or seed, financing.” The definition goes on to state that it’s likely the product or service is still being “tested or still developing,” and might not be completely ready to go to market or that it could be commercially available in a limited manner—but not generating revenue.

Can an early stage investment—and particularly the people behind that investment—really be defined so simply? Does just the aspect of the money received really tell the whole story, or is it simply the financial aspect, the surface color of a much more complicated and possibly emotional event?

Entrepreneurs often spend lifetimes imaging and building their businesses with lots of sweat invested. Selling ownership in one’s business, which is what someone is doing when he or she takes in an “early stage investment,” is analogous to giving away a piece of the baby one has loved and cared for, for years.

So wouldn’t it be prudent to really consider who that “early stage” money is coming from? Is it someone hoping for a quick flip transaction? Someone who might push a person to market before that person is ready? Is a person’s investing suitor looking to steal their baby from their hands and in the process become that person’s new boss? Does one’s potential investor understand one’s business? Do they even care to try? Taking these considerations into account is certainly imperative. It’s a good possibility that what might initially seem to be an exciting dream come true could actually become a real-life nightmare.

Jay Lichter, Ph.D. understands the issues from both the entrepreneur and investor perspectives. He spent a good part of his career behind the lab bench, doing pharmacogenetics research prior to being approached by Kevin Kinsella, the founding partner of Avalon Ventures, an early stage venture fund. When the duo met in the early 1990s, each took the time to talk plenty, establish a relationship and share business philosophies. They ultimately partnered and built a genomics company together that was eventually sold for $174 million. Today, Lichter nurtures other biotech entrepreneurs via select investments within the Avalon Ventures incubator facilities located in La Jolla, CA.

“Finding that investor who adds more than just dollars to the investing equation is crucial for an entrepreneur,” says Lichter. “The price established for the investment is not always what it appears to be if there is not mutual respect and an aligned development philosophy. Trust is certainly essential. But a good venture partner is also knowledgeable about one’s sector, takes the time to understand one’s business objectives, and very importantly, like a coach, knows how to inspire the best ultimate delivery of performance at just the right time.”

Sounds like good advice…and a good partner.