5 ms·
Ah, but you don't overpay for the failures, because they don't take more of your money. Instead, you invest the same $500,000 and get a smaller percentage of ow
by emmett 16y ago
Ah, but you don't overpay for the failures, because they don't take more of your money. Instead, you invest the same $500,000 and get a smaller percentage of ownership. But in all of the 0x and 1x return cases, it doesn't matter what percentage of the company you own.
- lisper 16y agoFor the outright losses this is true. But overpaying can transform the moderate wins into losses. Buy in at 1M sell for 10 you get a 10x return. Buy in at 20, sell for 10, you get a 50% loss. So if you're playing the middle (which is where the reliable returns are to be found) valuation matters. A lot.