I'd take a candidate who fights for a view I disagree with over one who hedges to please everyone (Strong opinions weakly held, but willing to change their mind if/when the data tells a different story)
>Best approach would be to make very few investments
Top VCs—who see the best deals and run deep diligence—still only have a 1–5% hit rate. As an angel, you don’t have that level of access or time. Even if you get strong referrals, you’d need to be 10–15x better than elite VCs to pick winners in a small portfolio. Unless you’re investing in at least 10 companies, it’s statistically a losing game.
My experience: I invested in ~200 companies early stage (with some winners like HuggingFace, Checkr & more).
I've not seen that much but what I've seen is "Let's ask a few buddies and google a bit".
The takeaway that I agree with is the parent's and OP's point that you will need to invest in a lot of companies, perhaps 30-50, and you will nee to be in for the long term.
You don't need to sell your stake for it to be a winner. It's a winner because his stake in the company is worth significantly more than when he bought it.
A lot of angel investors are not investing particularly large sums, and a lot of what they're doing is buying someone that's going to use services other people they're connected to are selling.
When you're multiples are 10,000x revenue, a lot of people will shell out $10k to get you onto a few startup services...
That's the investment itself. Not getting paid back.
Developing a network of people who do favors for each other and learning about other people’s businesses and industry. Angel investing usually isn’t that capital intensive, so it’s sometimes worth pursuing. I don’t do it to get rich.
At my last startup, I think our board and observers liked hanging out more than they liked talking about the company. It wasn't perfect, but it's their money so I wasn't going to complain.
>"It was very sad to call it quits because getting the funding to make those units was the only hurdle before making serious progress,” Temple said. “If they connected me with investors like they said, I could have made my invention, gotten efficacy and would be shipping units right now. I really do believe that."
It's unfortunate to see a founder believe that one accelerator would make or break their company. Typically an accelerator amplifies your existing trajectory - if you're a fast-growing company, you'll get more term sheets from investors than you know what to do with. If you're flat, they won't be attracting investors in any way. It's a founder's job to navigate this instead of relying on the accelerator to find $500k.
Some accelerators are targeted towards people who do not yet have companies. I can't say anything for or against them but I briefly participated in (and chose to leave) Carbon13, which aims to match people with a cofounder.
100x is a great return even for YC standards, but the best returns that business angels, VCs and YC have had is in the order of magnitude of 10000x (yes, ten thousand). So capping at 100x still makes it attractive for investors, yet leaves a lot of potential capital for the non-profit.
As one example, Sequoia invested in Airbnb at $0.01 per share, and Airbnb's current stock price is $102, almost exactly 10000x return. This happens more often that you think if you're not in the early stage & top VC world.
$0.01 per mean share would mean 6.5M USD valuation (current mkt cap is 65Bn). Accounting for dilution in investment rounds, let's say 4 x 20% dilution, that is around 52% penalty in valuation. Roughly, their entering price would be around 3-4M USD valuation. I am not saying in any way that this is a low return also, I may be wrong on my calculation, please, be free to correct me! ; )
> but the best returns that business angels, VCs and YC have had is in the order of magnitude of 10000x
Aren't those equity returns? i.e. when you sell (your shares of) the company to the public... the reason people still value the company is discounted future returns.
So if you want to generate such returns with cash (i.e. profit) it can take quite a bit longer.
When you invest in a company with this structure you're not doing it to make money, you're doing it b/c you believe in the product, that's why those structures exist, from my understanding.
I can only speak to what I'm familiar with, in my experience this has been the case. In my experience these individuals do donate to charity, but OpenAI is not a charity.
Something doesnt have to be a charity to be donated money towards. The question was: Why aren't they donating the money? The answer is: Because the want to make money.
Just FYI: OpenAI tried going the non-profit route, it didnt work, because suprise, suprise, in the grand scheme of VC things nobody wants to donate 10 billion dollars to anything.
Things are not Boolean, and they should not be. There is a gradient between "believing in the thing" and "purely wanting to make money" and most people fall somewhere in between those.
I have known of plenty of people (myself included) who would not invest in some companies because they think there are moral issues with that company. Same thing.
> Just FYI: OpenAI tried going the non-profit route, it didnt work, because suprise, suprise, in the grand scheme of VC things nobody wants to donate 10 billion dollars to anything.
Exactly, so they went something in-between, but in reality it is very much for-profit.
Chase sapphire cards and anything competing with that. FWIW getting reimbursed through my capital one ventureX card took over six months and was a major pain. Claims were handled by eclaimsline which capital one told me was part of Visa not themselves, it’s the only time I’ve used it so I don’t know if that’s common for other cards like Chase. Maybe they handle it it house and do a better job.
France’s RSA does not meet UBI standards that we’re considering in the US / California because the amount paid is so small. If you live alone with 2 kids, RSA would be 899€/month in 2022, far below minimum wage.
RSA is not only the monthly amount paid, the recipients also live in social housings paying next to nothing in rent, heating, healthcare and transportation.
A similar thing exists in other country like UK or Germany
A lot of things are cheaper when you have the RSA, but granted, it’s mostly leisure and optional things (museums, cinema, holidays at ucpa.com, etc). (ucpa.com is an excellent sports camp address for 18-40, by the way).
Not only optional thing. Metro/bus/tramway are nearly free for them. They also have reduced rate for utilities.
Granted it is not easy to live with 500€ a month, but you can get by.
The other option (more often used) is that you can raise more money at a higher valuation. You dilute yourself by the same amount as the initially planned raise, but you get more money and don't end up selling more/all of the company.
You can also have different classes of equity, you can have equity with reduced or no voting power but the same dividends rights, or the other way around.
What's important to highlight here is that marketing teams at companies such as Uber are incentivized to pus vendors to drive fraud. Specific example:
Uber works with vendors A, B, C. Marketing team is incentivized to reach a cost per sign-up of $X (Let's say $50 for the sake of this example). Vendor A, running fraud, delivers sign-ups @ 45$ each. Vendor B, clean, delivers them at $55 each. Vendor C @ $65 each. The new baseline from an exec standpoint is $45 each, and every vendor that doesn't deliver at that level is cut. Repeat with multiple vendors.
The solution to this problem is incrementality measurement at the channel level. Every time you scale with a recently onboarded vendor, measure baseline of ALL conversions happening on your app. If this baseline doesn't move, cut the vendor. I say scale and not launch because upon launh, there won't be a visible impact on the global conversions. To be able to spot this spike from baseline, pick a small market than "worldwide". For ex, pick "California", let the new vendor scale in California, and measure spike in California.
I'll also mention: this is a problem that goes up every ladder. Marketing individual contributor wants to show good performance to their manager, so delivering rides for cheap is good. Marketing manager is in the same boat with the CMO. CMO -> Board -> VC (VC will be happy to see great efficiency on the customer acquisition side). VC -> LPs (LPs will be excited about customer acquisition efficiency). A limited number of people are actually deeply concerned with this, and that's why it's taking so long for the top KPIs to change from "cost per action" to "incremental impact and incremental ROI".
I’m curious how many users (%) are annoyed by this. My gut feeling tells me only HN/Reddit/tech is annoyed by this, most people aren’t. Which is why we haven’t seen a competitor arise
