"what do you think are the biggest risks" and "have you ever lost money on a deal... tell me about it... what did you learn..."

I'm assuming you know the guy or at least he's a friend of a friend???... but if you don't know him, you need to get some sort of track record from him regarding the success/failure of his other deals - and get references -
stalk him on linkedin etc and call a contact or two... If it were big money (to you) that you're investing, I'd probably even call a couple of the subcontractors and/or vendors that we works with to see if he pays his bills on time and honors his contracts...

Real estate investing is the best ... good luck...