I'd like to keep putting as much of the earnings as possible back into the company for growth. But she's not interested in doing the deal unless we can structure at least a quick return on her investment. She's not a very experienced investor, and as as much as I've pleaded, she doesn't fully grasp how much more valuable it would be to continue to grow the company. But I've been struggling to find a way to get the company off the ground without her help, so desperate times. She's asking for 10%. So without structuring it as a loan, is there a way to structure it to make her terms doable?
*Edit 2/21/17: So she understands there's risk involved and that it's more likely to fail than be successful. It's high-risk, high-reward. We believe this particular project will either make it big or not make it at all. And I left out one vital detail: assuming the company begins to grow, she wants some form of payback at the time I were to begin taking a salary. I've thought about offering to defer my salary until the next round of funding. Think she may go for it, as simply having a next round would imply her investment has already grown.
honestly ... if possible I'd find different investment.
Taking this particular investor's money is going to move your focus away from long term sustainable business development and instead put your strategy into quick wins mode which is not going to result in the vision of the company that you have in your head.
I'm aware that doesnt answer your question, but without knowing more about your monetisation strategy, your 'sales funnel' etc it is difficult to see if you will get profitable enough any time soon to offer dividends, which would be one short term route to begin repaying her investment.
Another option you have, if you can see a way of using that investors money to position the business to quickly raise another round she could get out at that stage.
You could set it up as a 'convertable note', which is essentially a loan however in the event of a new round of funding you could give her the option of you beginning repayments on the debt with interest, or she could convert that debt into shares at a discount to the price everyone else is getting (cos she was in earlier than they were)
However, I'd still stick with the advice of not taking her money if possible and finding other investors, the 2nd option of getting involved with funding cycles especially so close together is hugely time consuming and painful (the least fun I have ever had in business)
One of things about investments, is that people should be aware where they're investing. Judging by what you say, she thinks she's investing in a business and not in a growing business.
Does your current and forecasted cash flow can afford to pay her?
In short, with the little information we have, I don't recommend taking this loan. You'll put your relationship in stress when things don't go as planned, with an startup, they're rarely do. Whatever your business is doing, at this stage is a risky loan (this is the norm). If the person investing doesn't understand this fact, then they shouldn't invest at all in this endeavour.
Best of lucks!
Tell her to keep her money until you need Cash flow loan