I’ve tried to be transparent about my own investing experiences over the years through various blog posts and podcast episodes. Let’s back up – why am I even writing about this? Mathematically, it’s vastly more challenging for a company to amass this type of return after it gets bigger and goes public…and even if it happens, it’s likely to take a decade or more. When you catch a small company in its infancy, you’re at least giving yourself a chance at this type of monster return. Maybe the aliens will be big fans of Apple products, but mega-size is usually a hindrance to scaling.īut what if Apple decides to give a key supplier contract to a small company valued at just $20 million? Think you’ll see some growth there? Is it more feasible for a startup to grow from a $10M valuation to “unicorn” status of $1B, or an established giant to grow on the same scale?Īpple could potentially have great returns in the future as they invent teleports, flying cars, and maybe holograms for future Zoom meetings, but how likely is it they will go from a $2 trillion market cap to $200 trillion? With my nitpick sidenote over, the bottom-line is startups offer the potential for vastly greater investment returns than just about anything you’ll find elsewhere. Most startups and VCs brag about how much money they’ve raised in follow-on rounds, but the most ideal investment is the one in which you invest, the company takes off like a rocket ship, and they never need to raise money again!
#Smbx shell creepr series#
Think of it like your pizza slice getting smaller and smaller every time the company announces their Series A, B, C, D, E….different share classes can have different returns too. So, the investor may have received a 50X, or 20X, or only a 2X (or less) depending on the funding raised. Rarely is this true, as most companies raise money along the way, which results in dilution to investors. Talk about hitting some winners (that he is certain to remind you about!)īefore we move on, a quick nitpick sidenote: Many commentators assume that if a company goes from a $10M valuation to a $1B valuation then the investor automatically returned 100X. In Jason’s case, that’s not 100, but 1,000 times the investment!īy the way, Jason was also an early investor in Thumbtack, Calm, Desktop Metal, and Trello.
#Smbx shell creepr how to#
Jason boldly lays it out in the title of his book, Angel: How to Invest in Technology Startups–Timeless Advice from an Angel Investor Who Turned $100,000 into $100,000,000. We chatted with Jason on the podcast back in 2017 about his angel investing journey. (PS: That little known investor was none other than Jeff Bezos, thank goodness he got this win, he needed to catch a break!)įinally, we could look at another early Uber investor, Jason Calacanis. A little-known investor plunked $250k into that round, and with the stock now at a >$1T valuation, that returned….I don’t even want to do the math. Or imagine investing in Google’s angel round in 1998. That’s a 24,900% return, or nearly a 250-bagger. went public back in 2017, Lightspeed Venture partners saw their $8M early investment grow to about $2B. However, while rare, these massive winners are within the realm of possibility for angel startup investors.įor example, when Snap Inc. When I polled my Twitter followers, 94% said they’d never had a 100-bagger, and in fact, most said they’d never even had a 10-bagger! Viewed in the context of average investment returns, it’s nothing but fantasy or wishful daydreaming. That’s a 100X return, and in the investment community, we refer to this rare event as a 100-bagger. That means you sink $10,000 into an investment and pull out a cool $1,000,000…for many investors this could be a life-changing outcome. Not 100% on your initial investment, 100 times your initial investment. When’s the last time you made 100X on an investment?
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