I was in the same situation as you are; what we did was quite simple actually. Together with your investors, agree upon a valuation for your concept (this is basically the hard part; don't try to come up with all kinds of revenue/profits predictions, just come up with a number both you and your investor can live with, dont't over-rationalize it) and give your investor equity for his money. Done!
I am sure many of you can come up with thousands of reasons on why a lawyer should be involved; however the simple approach worked fine for us.
I am going to go against everybody else here and say: "do it"! I would prefer having friends and/or family involved in my venture over some random smuck any day! There is a downside to everything, but come on! Making it sound like mixing f&f with business is a sure recipe for disaster is cow dung.