You can invest in Startup and make big return even if you are non-accredited investor

in #startup5 years ago (edited)

One of the reasons the rich get richer is because they have access to many opportunities that normal people do not have. One of these opportunities includes investing in startup companies. They funded these startups and when these companies do well, get acquired or IPO in the future, they make a huge profit in return. Previously, the law allows only accredited investors to invest in these companies at the early stage. And those people who are non-accredited investors weren’t allowed to participate in these forms of investment. Accredited investors, in general, are people who make at least $200,000 each year for the last two years.

However, In May 2016, the U.S. SEC enacted Title III of the JOBS Act, allowing non-accredited investors to invest in startups. This means that anyone can now invest in startup regardless of how much money you make, no matter who you are or where you live. You can invest as little as $10 in a startup.

One of the platforms that allow anyone to invest in a startup is Republic, an equity crowdfunding platform founded by Kendrick Nguyen, alumni of AngelList. According to their website, when you invest in Republic, you typically receive a Crowd Safe — a security issued by the startup. The Crowd Safe is not equity, it is an agreement for future equity, meaning that it can convert to equity in the future.

You can invest in Blockchain, medical or even VR related startups. Who knows the company you invested would not issue a billion-dollar IPO like Dropbox and Spotify 10 years down the road? If you are adventurous and are looking to invest in a startup, you can check out their website for more info. Remember, investment is risky and you can lose all your money so you should only invest what you can afford to lose.

You can sign up at Republic via this link: republic.co/note/i/jibupf
You will also get a bonus Note(Token) for using this link so it's a win-win :)

Here are a few things I consider when investing in startups. Some of these tips are taken from other websites/interviews that I read/listen to/watch a long time ago.

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  1. Invest in people.
    When you're looking to invest early in companies, you aren't investing in products, you're investing in the founders. The product will change many times over the course of the business lifecycle, which is why the founders will need to be passionate, skillful and motivated enough to stick to a mission.
    Ask yourself: Can this team pull it off? Can they work in stressful situations? Are they in it for the long haul? Have they had past successes? Do they get along outside of the office? Have they known each other for a long time? Are they experienced in the field? Can I offer value to them? Would they get along with me? If you answered no to any of these questions, you should reexamine the investment opportunity.--Scott Weiner, ClosingBell
  2. Only invest money that you don't need.
  3. Think in 10-year horizons:
    • Software startups take seven years on average to grow from its first VC investment to an IPO. As an angel investor, you might be investing years ahead of that first VC investment. Be prepared to be locked into each investment for a decade or more. Only invest money that you don't need
  4. Assume you are going to lose all your money. Treat success as a complete surprise. Successful venture capital firms generate approximately 80 percent of their returns from less than 20 percent of their investments. The chances are high your angel investments will be losing bets.
    So think of yourself as a patron of innovation. You’ll sleep a lot better at night, if you assume your investments are lost on the day that you make them
  5. The quality, passion, commitment, and integrity of the founders.
  6. The market opportunity being addressed and the potential for the company to become very big.

Disclaimer: I am not a financial advisor. Please do your own research before investing.
I have invested in a few startups through Republic and at the same time, Republic is providing X Notes to me as compensation for publishing this blog.

All the Best,
Van Lal Rem(aka Henry Vante)