The Best Place to Put Your Money? Other People's Businesses. Really. Be smarter about how you're investing your money with this approach you might be overlooking.

An endearing, but dangerous quality of BIZ Experiencess and small-business owners is their propensity to go all-in -- not only pouring all of their lives, hearts and souls into their business, but all of their money too.

Of course, many BIZ Experiencess simply need every penny they have and more to fund their businesses and there just isn't any money left to invest in anything else.

But once an BIZ Experiences gets beyond the survival stage in their business, they need to think about how and where money is working for them in their own business, and where it could do better. Oftentimes, a lot better.

The first challenge: BIZ Experiencess live, breathe, and too often suffer their own businesses so much that when it comes to investing, they can't think straight.

I encounter a lot of BIZ Experiencess who have this massive built-in bias toward ongoing, disproportionate investment in their own businesses. The result: they are often disinterested, and -- dare I say -- lazy when it comes to thinking about money and investments outside of their "baby."

So they take one of two approaches. The first is the passive one -- outsourcing money and investment decisions outside of one's business to a, so-called wealth manager. While there are compelling financial planning reasons to do this -- say, "we need to save and invest this much and earn this rate of return by this date to comfortably retire" -- the probability for actual investment returns via this approach is pretty low.

In fact, the S&P Indices Versus Active Funds Scorecard (SPIVA) shows that average "managed money" returns trail the index averages by almost the exact percentages of the fees charged for managing the money.

The second approach is more scattered, whereby investments in one-off real estate, startups, oil and gas and collectables opportunities, among others, are presented to the BIZ Experiences by a varying lot of well-meaning and potentially pilfering parties. And because BIZ Experiencess are fundamentally wired as optimists, they find these opportunities naturally appealing and invest – sometimes to good and lucky effect, but often disastrously so.

There is a better way. The hard-working BIZ Experiences can have his or her money earn a good rate of return while managing risk in a way that is aligned with their BIZ Experiencesial values, skills and industry knowledge.

For example, they can take an approach built on diversification that leverages traditional managed money vehicles like public market stocks, bonds and mutual funds, but also offers the opportunity for above average, and with good fortune, potentially excellent investment returns.

Simply put, it looks like this: Invest in what you know. In other words, a restaurateur could invest in other people's restaurants and food service businesses. Healthcare BIZ Experiencess could evaluate investment opportunities in healthcare. Those owning distribution or light manufacturing businesses, could evaluate other people's distribution and light manufacturing businesses.

Of course there are caveats to this approach.

You need to be cautious and conscious about industry risk factors, such as an uncertain regulatory environment and fast-changing technology that are beyond the control of any one or even several companies.

Secondly, to undertake this form of investment, especially when owning minority positions in private companies, you need to know what you're doing.

If you don't understand aspects of private equity investing like valuation, capital structure, control and anti-dilution provisions, it is probably better to either avoid this form of investing, or do so through a managed or private equity fund vehicle approach.

You may be asking: Why go through all the trouble? When done right, a properly executed and diversified "angel" investment approach like this can earn a very high investment return.

Research from the Kauffman Foundation Angel Returns Study and the Nesta Angel Investing study, compiled by Robert Wiltbank, have demonstrated that the "...average angel investor (across the U.S. and UK) produced a gross multiple of 2.5 times their investment, in a mean time of about four years."

Returns like this will not be found via traditional managed money approaches, and rarely -- especially when accounting for the huge opportunity costs of running a company -- in one's own business.

So for those BIZ Experiencess with the stomach and the work ethic for it, an "Other People's Business" investment strategy like this is one well-worth considering.