Venture capital?
- Thread starter dallas27
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Sunset
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Wouldn't that be like w*rk.
You would need quite a few millions that you could lose, need to check out carefully the concepts, principals involved, and then make many investments knowing 5/10 will fail, 4/10 will barely survive, and 1/10 will blossom.
But if you miss that 1/10 you kiss off pretty much everything.
You would need quite a few millions that you could lose, need to check out carefully the concepts, principals involved, and then make many investments knowing 5/10 will fail, 4/10 will barely survive, and 1/10 will blossom.
But if you miss that 1/10 you kiss off pretty much everything.
Senator
Thinks s/he gets paid by the post
Long before I would ever have enough to invest big money into someone business idea, I would have enough to keep me happy for the rest of my life.
Maybe a peer-to-peer situation might be OK, but even that is too risky for me.
Maybe a peer-to-peer situation might be OK, but even that is too risky for me.
AnIntentionalRoad
Recycles dryer sheets
I am a semi-actively angel investor but I keep each investment to a manageable level, generally 10-25k each. I've made 6 investments to date and have already reaped one very sizable exit that returned several multiples of everything I've invested in startups to date. All the other companies are still in business and doing well.
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DROPOUT
Recycles dryer sheets
I don't have the risk tolerance to become a VC, nor do I have ton's of other people's money to play with! ha
With that said ... I started dabbling in P2P investing last year. I invest at Upstart, which is a bit different than lending club, prosper, etc... For the most part, they tend to only give out loans to college grads, not to mention some other noticeable differences.
I originally invested $10k in April of 2015. That acct now sits at about $10,550 or so. I average about 6.5% return.
I enjoy it ... I know what its like to have tons of unconsolidated debt. I'd say, 75% of my loans (which are at $100/piece) are with college grads that want to consolidate Credit Cards. I've had very few delinquencies and/or charge offs!
For now, I don't plan to invest any more, but that's not to say I won't. I want to give it another full year before I put any more in!
With that said ... I started dabbling in P2P investing last year. I invest at Upstart, which is a bit different than lending club, prosper, etc... For the most part, they tend to only give out loans to college grads, not to mention some other noticeable differences.
I originally invested $10k in April of 2015. That acct now sits at about $10,550 or so. I average about 6.5% return.
I enjoy it ... I know what its like to have tons of unconsolidated debt. I'd say, 75% of my loans (which are at $100/piece) are with college grads that want to consolidate Credit Cards. I've had very few delinquencies and/or charge offs!
For now, I don't plan to invest any more, but that's not to say I won't. I want to give it another full year before I put any more in!
TallTim
Recycles dryer sheets
+1 to this.
Have done some similar deals with simple rules
(1) Max $50k
(2) A business I can (a) understand and (b) visit in person w min travel costs.
So far, it has worked out OK, slightly better than break-even.
That said, I would not want to do multi MM deals of this type. For that same return, I would sooner get my licenses and trade other people's $ for 1% carry and 20% of the upside.
AnIntentionalRoad
Recycles dryer sheets
I've considered launching a fund--have a few friends that have done so but chasing deals all over the country to put the investor capital to work isn't my idea of early semi-retirement.
Instead, I can invest on my own schedule as an angel.
Are you doing anything on Angellist or other platforms? I haven't gone there yet.
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Bamaman
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
My best friend is a Wharton MBA in finance, and he's got 35 years in the venture capital business.
It's something you have to go really big in, or not go into at all.
Venture capitalists' management fees are relatively low, and their big payoff is when they take a company, make it a success and cash out by private sell or stock IPO. It takes a large portfolio to live in the early years.
It's something you have to go really big in, or not go into at all.
Venture capitalists' management fees are relatively low, and their big payoff is when they take a company, make it a success and cash out by private sell or stock IPO. It takes a large portfolio to live in the early years.
AnIntentionalRoad
Recycles dryer sheets
Yes, one needs a 20MM fund at a minimum just to break even on a day to day basis. Many VC's charge 2% each year, so that is only 400k to pay for the substantial costs of operating the fund. Then you are waiting for the 20% upside from any exits but those could take 5+ years, if they ever materialize.
Many people right now are launching funds with 2-5MM and then after they've built up a book of investors and have some track record of making sound investments choices (even if no exits have taken place), launch a 2nd fund in the 20MM+ range.
Many people right now are launching funds with 2-5MM and then after they've built up a book of investors and have some track record of making sound investments choices (even if no exits have taken place), launch a 2nd fund in the 20MM+ range.
Bestwifeever
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DH has $15k in a young friend's small business--he expects never to see it again but he has had a lot of fun the past three or so years on the sidelines, another retirement activity for him.
I'm trying to figure out how to get a foot in the door to VC locally here in raleigh durham. Finance/VC, I am hoping, will be my next career as I downshift from IT consulting. Just looking to have some fun analyzing companies.
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calmloki
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
We lent $3500 to a guy who had a controller for bouncy cars - the ones that leap up and down like excited dromedarys http://i.imgur.com/mhVP5Of.gifv
Several years later we were astounded to get our money back from the girlfriend of said guy.
We do much better loaning to flippers and home builders who create value we can relate to.
Several years later we were astounded to get our money back from the girlfriend of said guy.
We do much better loaning to flippers and home builders who create value we can relate to.
AnIntentionalRoad
Recycles dryer sheets
Cool! Let us know how it goes.
How old are you, if you don't mind? Do you gave any finance education/experience?
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37, and I do mind being that old, parts are wearing out already!
I have been, the last few years, attending undergrad classes on finance and economics at Harvard's night school. But other than that, no finance experience outside personal "wealth". Finishing up an MBA primer at HBS this spring.
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Brat
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Most VCs invest in businesses they can watch closely. As someone else has mentioned you need to know the business, be able to assess its viability, and be within a 2-hour flight. Thus Silicon Valley VCs invest up and down the west coast, east to maybe CO. The exception would be game-changer projects in Israel.
To invest in a firm at the venture level you not only need to assess the viability of the business plan you must investigate the principal's financial history and legal exposure. You, in effect, are going into business with them.
To invest in a firm at the venture level you not only need to assess the viability of the business plan you must investigate the principal's financial history and legal exposure. You, in effect, are going into business with them.
2nd interview tomorrow morning. Basically i think i have the "job" as long as we can work out the details of what he needs out of me and what i can commit to offer him time-wise.
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AnIntentionalRoad
Recycles dryer sheets
Good luck!
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Brat
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Come in with a through analysis of the viability of a business and CV of the principals.
Update
So the private equity internship has been enlightening. And now that i understand how to execute a buyout with the targets own money, i'm realizing in my existing role at my IT startup, i am perfectly positioned to execute a hostile takeover and push out the ceo and the VC backers. I just need to get one key colleague to buy into the strategy and together we should be able to own the whole thing. Crazy stuff, moving very fast.
How quickly finance can turn you into a ruthless killer......
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So the private equity internship has been enlightening. And now that i understand how to execute a buyout with the targets own money, i'm realizing in my existing role at my IT startup, i am perfectly positioned to execute a hostile takeover and push out the ceo and the VC backers. I just need to get one key colleague to buy into the strategy and together we should be able to own the whole thing. Crazy stuff, moving very fast.
How quickly finance can turn you into a ruthless killer......
Sent from my iPhone using Early Retirement Forum
