179: 8 Things Sam Marks Has Learned from Startup Investing

Sam goes over the top 8 things he has learned from investing in startups. Sam has invested in 9 startups in the last 8 years and has seen 3 exits and/or partial exits in the last six months. He'll go over the process of investing in a startup, what to look for and what to avoid as well.  Listen to ILAB 179 on iTunes here or subscribe on your favorite podcast app. Where we are: Johnny FD – Ukraine / IG @johnnyfdk Sam Marks – South Carolina/ IG @imsammarks Derek Spartz - Venice Beach / IG @DerekRadio Sponsor: FundriseFundrise makes investing in private real estate as easy as investing in stocks, bonds or mutual funds. Get Started in just a few minutes. Support Invest Like a Boss: Join our Patreon Like these investments? Try them with these special ILAB links: ArtofFX – Start with just a $10,000 account (reduced from $25,000) Fundrise – Start with only $1,000 into their REIT funds (non-accredited investors OK) Betterment – Get up to 1 year managed free Wealthfront – Get your first $15,000 managed free PeerStreet – Get a 1% yield bump on your first loan *Johnny and Sam use all of the above services personally. Time Stamps: 06:04 – What do you look for in a start-up? 08:52 – Is it more important to have the management in place than what the company actually is involved in? 12:23 – Is international diversification important in your selection? 13:39 – How do you determine how much you are willing to invest? 14:28 – Are the Start-ups similar to how “Shark-Tank” portrays? 19:06 – #1: Companies take a long time to build and exit 22:05 – #2: Start-ups require more money, that initial investment is not the last investment. 26:15 – #3: Expect big dilution 32:52 – #4: Founder issues are common protect yourself against it 38:48 – #5: Cap tables becomes big issues for mediocre companies 45:10 – #6: Raising money is not the goal, creating value is 47:56 – #7: Valuation isn't important necessarily, what's more important is your entry point and exit point. 53:55 – #8: Nothing is a sure thing until the money is in your bank account 59:09 – What advice would you give to a beginner getting into a start-up? 63:25 – About how long is expected for the second round of investment? 65:16  – What should you look for in an attorney to look over the investment paperwork? 66:41 – What other ways can you be valuable to the company? If you enjoyed this episode, do us a favor and share it! Also if you haven’t already, please take a minute to leave us a 5-star review on iTunes and claim your bonus here!  Copyright 2021. All rights reserved. Read our disclaimer here.