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In the video tutorial, the importance of investment terms and agreements is emphasized. When an investor funds a company, it's not merely a cash transaction; it involves a set of terms that outline the investor-company relationship. The investor's money, which could be spent on other luxuries, is specifically allocated to the company with the expectation of growth and returns. Hence, understanding the terms is crucial for investors to know how their funds will be utilized, the conditions for recovery, and the benefits they can derive as the investment progresses. This framework ensures accountability and clarity in the use of invested capital.