What makes seed investors successful and why do they dare to invest?
Seed investors dare to invest because of their American approach. They take care of good and fast information. Between the American approach and the European is a philosophical divide.
When someone with an American approach invests in an early-stage startup, he accepts that the risk of failure is high.
He accepts that of his portfolio, the majority will fail. But by taking much risk he is convinced that a small percentage of its investments makes this amply. These are the new Instagrams, Ubers and Twitters.
A traditional investor only invests when there he has convincing evidence that the startup will generate an appropriate return on investment. However, this cautious approach guarantees a moderate efficiency.
It’s not that the American guy invests in something he thinks is bad. They just know that the chance of success is limited and that the survival rate of startups is limited.
That’s why they find out if that company has the potential to be huge (in order to be able to cover the inevitable losses), and they take steps to quickly back out if the scenario is realistic or a fairy tale. The question for them is not “How certain am I that this investment will bring the desired return?” but “How much can we afford to lose on a particular investment? ‘If an investment fails, they want this investment fails as soon as possible.
Peter discusses the 6 D’s of Exponentials and how to introduce a successful new technology
Did you know that 80% of all marketers say their organisations will need to undergo dramatic changes in the next 3-5 years in order to keep up with increased technical and consumer demands?
Marketo recently engaged the Economist Intelligence Unit to conduct a global survey of top marketing execs, with responses from over 500 CMOs at blue chip companies including MasterCard, Virgin America, Wells Fargo and Zipcar. To learn what is top of mind for these marketers and what key trends you should focus on, download this report.