I’ve written a bit about startup investing portfolio theory before:
- How do VCs make money
- Learnings from a 6x angel portfolio
- And a SPREADSHEET people can copy and play with
But I find some of the nuances of portfolio construction hard to grasp in writing. So, today, I thought I’d try something different. I made a super raw video that walks through the rough math of startup investing. I did this with 1 take and no editing – so bear with me.
This video is geared towards both founders and investors. I think going back to first principles of portfolio construction helps in understanding a lot of the psychology of what investors are looking to achieve. It may change how you pitch your company. Or heck, it may even help you decide that raising VC money is not for you, and that’s ok.
And for budding investors, this will help you understand what you’ll need to think through. I’ve met so many new microfund managers and angel investors who haven’t run through various scenarios of portfolio construction. And that’s surprising to me!
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