How Does Startup Investing Make You Rich

Startup investing beats stocks on returns but that’s not the secret that will make you rich. Find out how to invest in startups and check out these three pre-IPO investments https://mystockmarketbasics.com/dizraptor2 No other investment has created as many millionaires and even billionaires as startup investing. In fact, more than 25 billionaires on the Forbes list are there because of these types of startup investments with a combined net worth over $150 billion among them . Throughout the video, we’ll see how startup investing produces higher returns. For example, topping the Forbes list of private equity investors, Stephen Schwarzman nearly doubled his fortune to $37.4 billion in the 2021 survey! But that higher return on startup investing isn’t how it’s going to make you rich. Yes the 12.2% annual return over the last 20 years is double the return on the world stock index, and that difference would have added more than a million dollars to your portfolio investing $5000 a year in private equity versus stocks over a 30 year period. More than the higher returns though is the potential for these private equity investments to protect you in a stock crash. That means when your growth stocks in the Nasdaq plunge like they have this year, your private company investments can continue to produce returns! That’s more important than most investors realize and is the true secret to how startup investing will make you rich. Startup Investing is investing in startups that aren’t ready to issue stock on the public markets so these companies go to firms like Google Ventures and Peter Thiel to get funding until they’re ready to IPO. Sometimes called private equity or angel investing, it’s this early-stage funding for new companies that helps helps the company grow to the point where it can sell shares in an IPO or attract a buyout from a larger company. And I should clarify here, while I’m using the blanket term startup investing to describe all these pre-IPO investments, there is a big difference in the actual life cycle of a company. A completely new company will apply for seed funding and this might even be before there’s a finished product. From there, companies can go through several rounds of funding to keep that growth momentum until their ready for a final round of bridge financing before going public. 🤑 Get The Weekly Bow-Tie - my FREE weekly email newsletter sharing market updates, trends and the most important news! Market Updates for the Smart Investor! https://mystockmarketbasics.com/dailybowtie SUBSCRIBE to create the financial future you deserve with videos on beating debt, making more money and making your money work for you. https://mystockmarketbasics.com/LetsTalkMoney Joseph Hogue, CFA spent nearly a decade as an investment analyst for institutional firms and banks. He now helps people understand their financial lives through debt payoff strategies, investing and ways to save more money. He has appeared on Bloomberg and on sites like CNBC and Morningstar. He holds the Chartered Financial Analyst (CFA) designation and is a veteran of the Marine Corps.