Startup investing is unlike nearly all past forms of investing in that the big mistake is not choosing investments that lose money.
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@paulg does that mean that its better spread your capital to many small rounds rather that some big ones ? -
Not beyond a certain point. Fundamentally you just cannot screw up and miss the big ones.
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@paulg and I guess that "certain point" comes with experience. -
I believe the portfolio size you need is more math than experience.
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math lowers the risk too.
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same w/ hiring: “False Pos. (FP) = hiring someone who doesn’t work out. False Neg. (FN) = not hiring someone who would’ve 20x’d co”
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“Do not be afraid of hiring False Positives. Give people chances. Be afraid of missing the 20x employee” H/T
@henrysward@eshares
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conventions in larger fund models often need fewer, concentrated bets; early funds, accelerators can index, diff kind of advantage
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That's what Buffett calls errors of omission vs. commission anda he does too consider the first more damaging than the second.
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True. The winning though, is partly a result of the Investor's strategic contribution to the start ups development.
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counterintuitive to most b/c pain of losing money (startups that fail) is far greater than joy of being rich (
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So is one solution to seed many?
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what are the top 5 companies you turned down that you wish you hadn't?
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Guessing none of them are bigger than
@Airbnb
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how would you know the big winner beforehand?
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like advice of the buy low sell high variety
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It's not that revolutionary. Investing in spice ships in the 17th Century, all will cost money some have bigger potential returns
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What a metaphor for life.
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