Is the investor bringing anything to the table besides money? You'll want to ensure your investor is mature enough to understand basic things like he is making a loan/investment to your company and that you aren't personally liable for it. Make sure he is an accredited investor. Tell him to go to Angelconf! http://www.angelconf.org/ Hell, maybe you could go with him.
In this economy, if you aren't in the Valley you may be waiting a very long time for smart money. So is it normally looked down on here to take non-smart money? Yes. But if you're not a company coming out of YC that is juggling angel investors to find the one that is the best fit, sometimes you have to take what you can get.
Are you planning applying to YC or any of the incubators? That would be another reason to wait.
Deals fall through; that's a fact of life. Deals with inexperienced angels fall through in particularly screwy ways. Shortly after I started working on tarsnap, I talked to a wannabe angel; it sounded like we had hammered out the framework for a deal, but "I'll get this put into writing and send it over for you to review in a few days" stretched into two months, and the draft he sent over was unlike what we had discussed on nearly every important point -- and then when I objected he accused me of backing out of a deal and threatened to sue me for the cost of drafting it (he never went so far as to tell me how much those fees were, though, so I guess he came to his senses).
Seriously -- unless you're dealing with an angel who has a track record, trust them as much as you'd trust a second hand car dealer.
BTW, nice site!
sorry ;)
