Start with use of funds and repayment
Identify exactly what the money will finance and the cash event that will repay principal and interest. Then model what happens if that event is late or smaller than expected. Only after that should the parties discuss a headline rate, a marketing plan, or a public offering.
Resolve the core structural questions
Confirm who approves and signs the debt; whether it is secured, subordinated, guaranteed, or convertible; what claims rank ahead of it; whether any parties are related; and what tax, withholding, and regulatory consequences arise. If the note may be offered beyond a known private lender, securities counsel should be involved before any solicitation.
Make clarity the product
The borrower gains a capital plan aligned with operating cash. The recipient gains a documented claim and timely information. The company gains a record that can be explained in due diligence. This is the central benefit of disciplined IOU management: clarity before money moves and evidence after it does.