The _only_ way this idea meets my standards is if the loan is invested in a corporate entity which enables the recipient to fail and walk away from the debt (and assets, of course).
Let me state this as clearly as possible for anyone that thinks this is a good idea: "excessive usury" is pure evil. Being able to walk away from failure and start again is the secret sauce that makes the American economy the envy of the world.
Part of my motivation to get an investor was precisely to offload that financial risk to someone else. I'm already putting in at least 2 years of my life, including a lot of blood and sweat. If I fail then the last thing I'd want is to spend another X years getting rid of that debt...
Also I'm truly baffled at your statement of:
even an entrepreneur who has failed to get rich by the end of the four year can resort to taking a job at a big company. One year of that will pay off most of the loan, and will allow him to take a separate loan from the bank to cover the rest.
Excuse me?
After the 4th year I'd owe you roughly $120000. Most of us mere mortals would probably need closer to 7-8 years to pay that back.