3 Ways to Mint Money From Startup Investing

One is absolutely critical… Published By Money & Markets, LLC. July 27, 2024 Published By Money & Markets, LLC. July 27, 2024 [Turn Your Images On] Editor's Note: We're featuring another piece from Crowdability's Matt Milner in today's Money & Markets Daily. The former Wall Street exec, startup founder and venture capitalist is now helping ordinary people invest in — and profit from — private startups. Keep your eyes on your inbox for ways to follow Matt and his team at Crowdability into incredible opportunities. Enjoy! 3 Ways to Mint Money From Startup Investing The cheerful stewardess on my red-eye to Argentina was delivering a familiar speech. Her soothing voice washed over me as I sat in a window seat, reading the business plan for a tech startup. “There are ten emergency exits on this Boeing 777 aircraft,” I heard her say. “Four in the front, four in the back, and two located over the wings.” The business plan I was looking at was intriguing. Good team, interesting product, some initial traction. But something about it was bothering me, nagging at me. The stewardess continued her speech. “Keep in mind that your nearest exit may be behind you.” When she finished her presentation, I glanced around to locate the emergency exits. And as I buckled my seatbelt, I suddenly realized what had been bothering me: The plane had ten emergency exits. The flight crew knew exactly where they were, and how and when to use them. They had a rock-solid exit strategy. But the startup I’d been reading about didn’t have any “exit strategy” at all. In other words, it didn’t have a way for me to “exit” my investment and make a big profit! Exit Strategy Investing in early-stage companies can be fun and exciting. It’s always a pleasure to see a dream become a reality. But to make money, you need “an exit.” Essentially, you enter an investment by writing a check. And you exit by getting your money back — or hopefully, getting back many times your money. (We target a 10X return on all of our startup investments.) That’s why, if you’re exploring making an early-stage investment, one of the most important questions you have to ask is this: “What’s the exit strategy?” --------------------------------------------------------------- [Turn Your Images On]( [Apple's Secret Software Update]( Apple has been quietly working on a revolutionary new technology. This technology — codename “MM1” could send TRILLIONS of fresh dollars rushing into the economy. And Chief Investment Strategist Adam O’Dell has identified [one tiny company]( that could be at the center of Apple's new world-shifting device. [Click here right now to get the full details.]( --------------------------------------------------------------- 3 Ways to Mint Money From Startup Investing Airplanes have multiple exit possibilities — two over here, two over there, two in the back. They’re everywhere. It’s the same thing with startups. Here are the three main ways a company can exit: 1) The startup is acquired by a bigger company. 2) The startup goes public in an initial public offering (an IPO). 3) The startup becomes profitable, and determines it doesn’t need all its cash for growth. At that point, it can return money to shareholders in the form of dividends and distributions. The Odds If you’re playing by the odds, it’s unlikely you’ll be rewarded through dividends or an IPO. Very few startups end up paying a dividend. And only a tiny fraction of them achieve enough scale or stability to go public. Your No. 1 exit strategy? An acquisition. Looking for Clues Unlike on planes, exits for startups aren’t always clearly marked. But the clues are often there. The clues include a big market. Or a sector that’s growing like a weed. Or one or more acquirers who can write a big check. Here’s an example you might be familiar with: By 2012, Facebook had nearly one billion users. Many of those users spent hours each day on Facebook’s website. Meanwhile, two major trends were picking up steam. First, consumers were spending far more time on their mobile devices. And second, consumers had fallen in love with taking pictures on their phones and uploading them to sites like Facebook. So in April 2012, Facebook acquired a young private startup — a photo app called Instagram — for $1 billion. What did Instagram have that was possibly worth $1 billion? Well, first of all, it was targeting a huge market: casual photographers. Secondly, it was on the cutting edge of several emerging sectors, including Mobile. And thirdly, several potential acquirers — including Facebook, Twitter and Yahoo — were eager, even desperate, to grow their mobile efforts, and could afford to write huge checks. Why I “Passed” In contrast to Instagram, the business I was reviewing on the plane lacked any signs of a future potential exit. It was targeting a small, niche audience. Forget about reaching a billion users. It would have trouble scaling to 10,000 users. It wasn’t part of a fast-growing sector like Mobile. And it was nearly impossible to imagine a bigger company buying it. There wouldn’t be much to buy — no big audience, for example, and no proprietary technology. It had no exit strategy. So for me, it was a clear “pass.” Always Be Exiting Investing in a startup where you can’t identify an exit strategy is like getting on a plane that doesn’t have the exits clearly mapped. So when it comes to startup investing, make sure you ask yourself: “What’s the exit strategy?” Happy Investing. Best Regards, [Turn Your Images On] Founder Crowdability.com --------------------------------------------------------------- [Turn Your Images On]( [This One Hidden Anomaly Has the Power to Unlock the Biggest Stock Gains]( Adam O’Dell cracked the code to unlocking the biggest gains in the stock market today, by taking advantage of a hidden anomaly. It has nothing to do with crypto, options or penny stocks. Yet it has the power to beat the market by 300% ... by targeting stocks with the biggest profit potential every single month. [Get all the details.]( --------------------------------------------------------------- Check Out More From Money & Markets Daily: - [REVISITING 2 SUMMER HEAT WAVE STOCKS]( - [THIS HOMEBUILDER IS EXECUTING MAXIMUM MOMENTUM]( - ["HISTORY REPEATING:" IS THIS 1968 ALL OVER AGAIN?]( --------------------------------------------------------------- [Turn Your Images On]( Privacy Policy The Money & Markets, P.O. Box 8378, Delray Beach, FL 33482. To ensure that you receive future issues of Money & Markets, please add info@mb.moneyandmarkets.com to your address book or [whitelist]( within your spam settings. For customer service questions or issues, please contact us for assistance. The mailbox associated with this email address is not monitored, so please do not reply. Your feedback is very important to us so if you would like to contact us with a question or comment, please click here: [( Legal Notice: This work is based on what we've learned as financial journalists. It may contain errors and you should not base investment decisions solely on what you read here. It's your money and your responsibility. Nothing herein should be considered personalized investment advice. Although our employees may answer general customer service questions, they are not licensed to address your particular investment situation. Our track record is based on hypothetical results and may not reflect the same results as actual trades. Likewise, past performance is no guarantee of future returns. Certain investments carry large potential rewards but also large potential risk. Don't trade in these markets with money you can't afford to lose. Money & Markets permits editors of a publication to recommend a security to subscribers that they own themselves. However, in no circumstance may an editor sell a security before our subscribers have a fair opportunity to exit. Any exit after a buy recommendation is made and prior to issuing a sell notification is forbidden. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. (c) 2024 Money & Markets, LLC. All Rights Reserved. Protected by copyright laws of the United States and treaties. This Newsletter may only be used pursuant to the subscription agreement. Any reproduction, copying, or redistribution, (electronic or otherwise) in whole or in part, is strictly prohibited without the express written permission of Money & Markets. P.O. Box 8378, Delray Beach, FL 33482. (TEL: 800-684-8471) Remove your email from this list: [Click here to Unsubscribe]( Privacy Policy The Money & Markets, P.O. Box 8378, Delray Beach, FL 33482. To ensure that you receive future issues of Money & Markets, please add info@mb.moneyandmarkets.com to your address book or [whitelist]( within your spam settings. For customer service questions or issues, please contact us for assistance. The mailbox associated with this email address is not monitored, so please do not reply. Your feedback is very important to us so if you would like to contact us with a question or comment, please click here: [( Legal Notice: This work is based on what we've learned as financial journalists. It may contain errors and you should not base investment decisions solely on what you read here. It's your money and your responsibility. Nothing herein should be considered personalized investment advice. Although our employees may answer general customer service questions, they are not licensed to address your particular investment situation. Our track record is based on hypothetical results and may not reflect the same results as actual trades. Likewise, past performance is no guarantee of future returns. Certain investments carry large potential rewards but also large potential risk. Don't trade in these markets with money you can't afford to lose. Money & Markets permits editors of a publication to recommend a security to subscribers that they own themselves. However, in no circumstance may an editor sell a security before our subscribers have a fair opportunity to exit. Any exit after a buy recommendation is made and prior to issuing a sell notification is forbidden. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. (c) 2024 Money & Markets, LLC. All Rights Reserved. Protected by copyright laws of the United States and treaties. This Newsletter may only be used pursuant to the subscription agreement. Any reproduction, copying, or redistribution, (electronic or otherwise) in whole or in part, is strictly prohibited without the express written permission of Money & Markets. P.O. Box 8378, Delray Beach, FL 33482. (TEL: 800-684-8471) Remove your email from this list: [Click here to Unsubscribe](