In a previous post, we delved into the importance of diversification in a start-up portfolio. We looked at ‘The Babe Ruth Effect’ and the number of different positions that should be taken to properly diversify an early stage investment portfolio. Startup investors must be aware that they are going to encounter more losses than wins. Success of a portfolio is based on those few home runs, which drive the overall return. However, there is a degree of nuance and some pitfalls that are worth noting in order to diversify successfully.
From the desk of Chance Barnett, CEO of Crowdfunder
There is a proven process to successfully raising startup funding.
I’ve learned about the process over the years by getting to know a few of the worlds most successful serial entrepreneurs, by raising millions myself from angels & VCs, by investing as an angel, and as CEO of the VC fund + equity investment platform Crowdfunder.com.
Across all this investment and fundraising activity, I’ve seen that the most successful fundraises have a several key elements in common. Below are five parts to successful fundraising for your startup — with specific examples, templates, and resources.
Millennials are not only the largest generation in U.S. history, they will also receive the greatest transfer of inherited wealth ever.
It’s also been observed that Millennials are changing how businesses operate through their unique preferences and behaviors surrounding spending, lifestyle, and finance.
Because of this, Millennials are poised to transform nearly every facet of the U.S. and global economy, and the Finance industry is about to experience tremendous change as it works to address the needs and preferences of this different customer.
Diversification is key to mitigating risk and maintaining a healthy startup portfolio. As media coverage is saturated with news of unicorns like Facebook and Alibaba leading to huge paydays for investors, it’s easy to look past the risk to the possible reward. But it’s important to remember that the majority of startups fail. According to performance analysis by the Kauffman Foundation, 52% of all venture exits are at a loss. How can you integrate diversification into your portfolio?
- Impact investing continues to gain traction.
- In the near future a standard will be established for impact criteria.
- Impact investors may attain similar results to more traditional vehicles though it may require a longer investment horizon for gains to be realized.
Since this interview, Digitzs has reserved over $7 Million for their Crowdfunder Campaign.
We sat down with Laura Wagner, CEO of Digitzs, to discuss her keys to startup success and how her team has raised close to $4 Million on the Crowdfunder platform and is currently #3 on The CNBC Crowdfinance 50 Index.
Have some extra cash and want to start investing in startups? Become an Angel Investor. An Angel Investor is a private investor who provides working capital for business startups in exchange for equity. Angel investing is a risky investment but the reward is great if you pick winners. Because the majority of startups fail, due diligence is key. Here are the factors to consider when evaluating startup investment opportunities.
In the more than two years since the passage of Title II of the JOBS Act, equity crowdfunding with accredited investors has rapidly grown, allowing startups to easily seek funding online with little added costs or hassles.
As the CEO of Crowdfunder, a leading equity crowdfunding platform + venture fund, I see firsthand how the ability to reach thousands of Institutional and individual angel investors online through equity crowdfunding is transforming startup fundraising and early stage venture capital.
Unfortunately, the highly anticipated “boom” of access to non-accredited investors, namely regulated under Title III, is a bit of bust. I wrote previously about howTitle III Crowdfunding Will Disappoint Entrepreneurs.
- Dollar Shave Club has found success in disruption of established industries.
- Companies such as Dollar Shave Club, GoDaddy and Geico have used marketing to differentiate their businesses.
- Companies that establish loyal followers create brand ambassadors for years to come.
Earlier this month, Microsoft announced it would acquire LinkedIn for $26.2 Billion, valuing the company at 91 times earnings. LinkedIn performance has been lackluster since it’s public debut dropping $11 Billion from its market value in February following lower than expected 2016 revenue forecasts. Despite poor performance, many in the Venture Capital and Technology space argue this acquisition is a good deal for Microsoft. The potential upside is huge given LinkedIn’s domination of the professional social networking space boasting 430m registered users and 100m visitors to its site each month.
The deal signals the growing wave of tech acquisitions and a decrease in IPOs caused by a race for market share between the tech titans (Google, Microsoft, Apple, Facebook and Amazon) and a data grab by these companies. This is good news for startups and investors, providing another route to liquidation in a tough IPO market.