Many years ago, I heard the story of a man whose business partner did dirty. They were business partners for almost 5 years and the suddenly the business partner left with company's money. Even after several years, this man didn't recovered. He ended up sounding it as a warning to his kids never to go into business with anyone. The trust was destroyed and never recovered. This is just one of those sad stories.
On the other hand, there are many success stories of friends who went into business together and succeeded to together. If you have ever gone into business with a friend, what were your biggest concerns and how did work through it.
How can someone just disappear with the "company's money"? How was he able to withdraw all in cash? He does know his friend. He does have his ID and stuffs. Finding where he is hiding would have been a piece of cake for the law enforcements (unless he escaped the country, and the police would know that too after little investigation...). So did he report to the cops or not?
As long as you trust him, you should be fine. Register your business, put conditions on how someone can handle the company's money. Never let one person have full access to the funds.