Daymond here.
Everyday investors are more powerful than the biggest venture capital institutions on the block.
It may sound silly. After all, firms like Sequoia and Andreesen Horowitz are legends in the private equity arena, worth billions of dollars each.
But I firmly believe that you have much more power than you think you do, even if you’re not writing the same million-dollar checks.
Your secret weapon? Value add. In short, that’s the idea that you can add much more to a startup than simply capital. Your skills, your expertise, and your community can ultimately help launch an early-stage venture into a multibillion-dollar unicorn… more so than a team of 1%-er VCs.
How to get started? Let’s talk about it. Here are three of my favorite value-add strategies for all startup investors… even if you’re writing a $50 check.
Investors are often a company’s best customers and most helpful critics. By testing the product, you can identify areas of strength, pain points, and anything else worth mentioning to the founding team… all from the perspective of a third-party who can give a more objective opinion.
I’d suggest testing out the product before you invest, and continuing to test it out as the company develops. Your feedback can go a long way in assessing product/market fit and making sure the company is well set up for success when its product officially launches.
As an investor, even just sharing a company on social media can be a tremendous help. Keep up with the latest news from your portfolio companies, tell your friends and family about your investment, and keep the conversations going online.
Ultimately, it’s every startup’s goal to get in front of as many people as possible to better their chances of maxing out their raise. It’s all about marketing… and just by spreading the word, your portfolio’s founding teams will thank you.
Chances are, you have something to offer your portfolio companies outside of capital, whether it’s a special skillset, an area of expertise, some useful connections, or more. Figure out what it is your portfolio company needs, and exactly how you can help them achieve unicorn status one day.
Even a couple of hundred dollars can go a long way in helping to turn a startup into a multibillion-dollar venture. You have the power to directly impact a real business – right at the start of its journey – and take a shot at building your own generational wealth along the way.
But even more than that, your community is power. You are a part of a Network that is tens of thousands of people strong. Each member of this community has their own skills, connections, expertise, and more. And brought together, that type of community (and the value it can bring an early stage company) is revolutionary.
And at the end of the day, it’s much more powerful than just one venture firm sitting on a pile of cash.
Together, we can identify the next greatest visionaries to take the startup stage, back them with our own capital and value, and hopefully create hundreds and thousands of jobs for hardworking folks across the country.
It’s the American Dream… and it starts with Main Street angel investors, just like you. I can’t wait to see where this journey takes us, so stay tuned for even more.
In the meantime, we’ve been chatting for a couple of months now, and I’m curious…
Do you have any questions? Is there anything you’d like me to cover?
Drop me a line in the comments below. As any good entrepreneur or investor knows, feedback is invaluable, and I want to make sure I’m covering topics you want to hear most. Let me know, and I’ll work them into a future blog post.
With that, have a great rest of your day. We’ll talk soon.
Daymond John
Everyday investors are more powerful than the biggest venture capital institutions on the block.
It may sound silly. After all, firms like Sequoia and Andreesen Horowitz are legends in the private equity arena, worth billions of dollars each.
But I firmly believe that you have much more power than you think you do, even if you’re not writing the same million-dollar checks.
Your secret weapon? Value add. In short, that’s the idea that you can add much more to a startup than simply capital. Your skills, your expertise, and your community can ultimately help launch an early-stage venture into a multibillion-dollar unicorn… more so than a team of 1%-er VCs.
How to get started? Let’s talk about it. Here are three of my favorite value-add strategies for all startup investors… even if you’re writing a $50 check.
1. Test the product and provide feedback.
If you’re investing in a startup, it’s a good idea to test the company’s product or service to get an idea of what it is you’re adding to your portfolio.Investors are often a company’s best customers and most helpful critics. By testing the product, you can identify areas of strength, pain points, and anything else worth mentioning to the founding team… all from the perspective of a third-party who can give a more objective opinion.
I’d suggest testing out the product before you invest, and continuing to test it out as the company develops. Your feedback can go a long way in assessing product/market fit and making sure the company is well set up for success when its product officially launches.
2. Spread the word.
Social media is a startup company’s best friend when they’re trying to gain traction. And with an army of everyday investors on their cap tables, startups have an even better shot at getting attention on the internet.As an investor, even just sharing a company on social media can be a tremendous help. Keep up with the latest news from your portfolio companies, tell your friends and family about your investment, and keep the conversations going online.
Ultimately, it’s every startup’s goal to get in front of as many people as possible to better their chances of maxing out their raise. It’s all about marketing… and just by spreading the word, your portfolio’s founding teams will thank you.
3. Harness your power.
The beauty of angel investing is that you have a more direct line of contact with a startup’s founding team. Where traditional stock investors are detached from their portfolio companies’ founders, you’re not. You can use that to your advantage.Chances are, you have something to offer your portfolio companies outside of capital, whether it’s a special skillset, an area of expertise, some useful connections, or more. Figure out what it is your portfolio company needs, and exactly how you can help them achieve unicorn status one day.
Even a couple of hundred dollars can go a long way in helping to turn a startup into a multibillion-dollar venture. You have the power to directly impact a real business – right at the start of its journey – and take a shot at building your own generational wealth along the way.
But even more than that, your community is power. You are a part of a Network that is tens of thousands of people strong. Each member of this community has their own skills, connections, expertise, and more. And brought together, that type of community (and the value it can bring an early stage company) is revolutionary.
And at the end of the day, it’s much more powerful than just one venture firm sitting on a pile of cash.
Together, we can identify the next greatest visionaries to take the startup stage, back them with our own capital and value, and hopefully create hundreds and thousands of jobs for hardworking folks across the country.
It’s the American Dream… and it starts with Main Street angel investors, just like you. I can’t wait to see where this journey takes us, so stay tuned for even more.
In the meantime, we’ve been chatting for a couple of months now, and I’m curious…
Do you have any questions? Is there anything you’d like me to cover?
Drop me a line in the comments below. As any good entrepreneur or investor knows, feedback is invaluable, and I want to make sure I’m covering topics you want to hear most. Let me know, and I’ll work them into a future blog post.
With that, have a great rest of your day. We’ll talk soon.
Daymond John
Follow @angelsandentrepreneurs
Great post, Daymond! I would like to see your ideas about how to find worthy startups. Its challenging.
Are you familiar with the start up called goofee. They’re in their second round of financing on start engine. They have a great business going even through the pandemic but investors do not seem to be putting their money into this company. I believe if they can get enough money in this round they will go on to great achievements. My question is how can they get over the hump here and get Investors interested.
I have invested in startengine and many of the companies are on this
Platform also.
Is there a connection on this one and that one?
Thanks.
Damon I think that’s great advice to try out the product first before investing. But some of the companies have products that cannot be tried out such as Graze and liquid piston for example. So we have to look at other factors when investing in those type of companies and estimate how the market will advance as a consequence of the product. What is the best way to determine that?
Yes how to invest in big companies with just $1000
Good info thank you Mr.John!
Thank you for the 3 points. All 3 are valid.
It’s actually GOffee. Anyway, here are two suggestions. Your thoughts about SaaS-type companies. If a company has a product, maybe I can wrap my head around addressable market, cost of goods, and the profits from each item sold. From there I can convince myself that the numbers might get from A to B, and my investment might get somewhere. Already vague enough. Saas is worse. The only things I think I need to consider are even more abstract. A startup will say they charge $X for their product, for certain customers who need that niche, and of course they talk about the growth they are experiencing. I know that MailChimp is worth billions, I am sure I never would have thought so when it was starting out. Super scalable, but otherwise, what am I looking for?
Valuations are funny, you could write several columns about that. I read what founders say about their valuations. They might have 3rd parties, they sometimes seem to be influenced somewhat by the platform they raise on. Some people seem to think companies that have earned no money at all are not entitled to a valuation above a few million. Comically, plenty of companies with no profit have raised their $1.07 in short time, even as people whine that their valuation is too high.
My own thoughts are that as more people learn about Reg CF, there might be money flooding startups so much so that companies will start to abuse their valuations, knowing that they will get close to the $5M they want.