How to Lose a Fortune… and Still Retire Rich

By Wayne Mulligan, on Thursday, July 20, 2017

When you screw up the majority of the time, things don’t generally turn out so well.

For example, think back to your days of taking tests in school:

If you answered two-thirds of the questions wrong, you failed.

It’s the same thing with picking stocks:

In the stock market, if you lose money on two-thirds of your trades, you’ll go broke.

But here’s the thing:

When it comes to investing in start-ups, you can screw up two-thirds of the time and still earn a fortune.

Today, I’ll explain the secret behind this phenomenon…

Then I’ll show you how it could help you retire rich.

Start-up Math

Before I explain the secret, let me show you the “math” behind start-up investing:

Let’s say you make 10 start-up investments of $1,000 each.

Generally speaking, 1/3rd of those deals will fail, 1/3rd will break even, and 1/3rd will deliver massive returns.

At first blush, that might seem like a lot of screw-ups…

But as it turns out, you could still do very, very well. Here’s the math:

The 3 “loser” investments will return nothing (3 x $0)…

The 4 deals that broke even will return $4,000 (4 x $1,000)…

And the three winners will return 10x each, for a total of $30,000 (3 x $10,000).

Add it all up, and your $10,000 investment turned into $34,000.

You more than tripled your money!

The Key to Success

But here’s the thing:

You can’t make just 10 investments and expect this math to work out.

It’s like flipping a coin:

When you flip a coin, you have a 50/50 chance of it landing on heads or tails.

If you flip a coin once and it lands on heads, that doesn’t mean it’ll land on tails the next flip.

However, if you flip it 100 times, there’s a good chance you’ll flip heads as many times as you flip tails.

It’s the same thing with early-stage investing...

In order for the math to work out, you need to invest in many, many companies.

And that’s why the key to investment success in this market is clear:


Diversify or Die

How many investments does it take to be considered “diversified”?

According to research studies — and based on in-depth conversations with our network of professional early-stage investors — you should aim to build a portfolio of at least 25 to 50 early-stage deals. (And if you invest in 100 or more, that’s even better.)

So if you’re planning to invest, say, a total of $10,000 into your start-up portfolio, you’d invest $200 to $400 into each of 25 to 50 deals.

Investing in 25 or 50 deals might sound like a lot of research and work…

But we recently identified a way for you to claim a stake in hundreds of private, early-stage companies with just one investment.

It’s like a mutual fund for start-ups…

GSVlabs – A Mutual Fund for Start-ups

GSVlabs is what’s called an “accelerator program”

It’s a hands-on mentoring program for start-ups. After accepting only a tiny fraction of the companies that apply, it puts start-ups through a multi-month “boot-camp,” honing their business plans, and preparing them to raise money from investors and blast off to success.

In exchange for its mentoring and efforts, GSVlabs takes an ownership stake in each start-up — and things are working out very well so far:

Many of GSVlabs’ 185 early-stage start-ups (including Privatecore, Nascent Objects and Welkio) have already been acquired by major tech companies such as Facebook and WeWork.

And other companies it’s mentored have already gone on to raise capital from top-tier professional investors such as Sequoia, Index Ventures, and Comcast Ventures. In 2016 alone, its start-ups raised more than $250 million from these investors.

Now GSVlabs is raising capital from investors like you, with a minimum investment of $100.

As an investor, you’d enjoy the upside potential of each start-up that GSVlabs is mentoring.

Simply put, this offers you a way to invest in hundreds of start-ups with a single investment.

To be clear, this investment doesn’t come without risk.

But if you’re seeking an easy way to diversify your start-up portfolio, this might be a good place to start.

You can learn more here »

Please note: Crowdability has no relationship with GSVlabs, or with any of the companies or platforms we write about. Crowdability is an independent provider of education, information and research on start-ups and alternative investments.

Best Regards,
Wayne Mulligan
Wayne Mulligan


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