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I agree that ordinary people shouldn't bet their life savings on startups. But this allows an average well-informed SF employee to invest $1,000-2,000/month of

I agree that ordinary people shouldn't bet their life savings on startups. But this allows an average well-informed SF employee to invest $1,000-2,000/month of his/her salary into any startup they like - hardly a life changing amount. See it as a Kickstarter on steroids. At least this gives us a chance too to invest in the next Dropbox and Airbnb.

runako 14y ago
Worth noting: $1,000-2,000/month stashed in a less risky asset class (e.g. index funds) over 30 years is likely to be enough for most people to retire comfortably. That's potentially life changing over the long term.
- wilfra 14y ago
  Indeed. Nobody should limit their investments to just these. For every $1,000 you put into a crowdfunded company, you should be investing at least $4,000 in more traditional and safe investments. And 20% is even a lot. That assumes a young person who has high future earnings potential and a high risk tolerance. 5-10% would be more reasonable for most people. That said - this is certainly an asset class one could beat the S&P500 with, as long as you aren't just throwing darts and are actually investing in companies you know a lot about and understand.
  - jwallaceparker 14y ago
    > traditional and safe investments This made me chuckle. The "traditional" investment vehicles of US stocks, real estate and bonds are anything but "safe" these days.
    - wilfra 14y ago
      The last few years are not representative of the long term. Over the long term stocks, bonds and real estate - in aggregate - rise in value. If you don't want to risk short or medium term fluctuations and black swans, the ultimate traditional and safe investment is a savings account. If you're the type that thinks fiat currency is only worth it's weight in toilet paper, then buy gold. For any of these investments you'll have more left at retirement than if you put 100% of your capital into startups that ended up going out of business.
mikeryan 14y ago
But this allows an average well-informed SF employee to invest $1,000-2,000/month of his/her salary into any startup they like - hardly a life changing amount. See it as a Kickstarter on steroids. At least this gives us a chance too to invest in the next Dropbox and Airbnb. These aren't "ordinary" people? This model's only barrier to entry is the $1k it takes to get in (AFAICT) its not limited to "well-informed SF employees".
aaronbrethorst 14y ago
> At least this gives us a chance too to invest in the next Dropbox and Airbnb. And the next Webvan, Pets.com, Kozmo, Flooz, eToys, Boo, etc etc etc, saying nothing of the huge number of failures we don't even know about.

runako 14y ago

Worth noting: $1,000-2,000/month stashed in a less risky asset class (e.g. index funds) over 30 years is likely to be enough for most people to retire comfortably. That's potentially life changing over the long term.

wilfra 14y ago
Indeed. Nobody should limit their investments to just these. For every $1,000 you put into a crowdfunded company, you should be investing at least $4,000 in more traditional and safe investments. And 20% is even a lot. That assumes a young person who has high future earnings potential and a high risk tolerance. 5-10% would be more reasonable for most people. That said - this is certainly an asset class one could beat the S&P500 with, as long as you aren't just throwing darts and are actually investing in companies you know a lot about and understand.
- jwallaceparker 14y ago
  > traditional and safe investments This made me chuckle. The "traditional" investment vehicles of US stocks, real estate and bonds are anything but "safe" these days.
  - wilfra 14y ago
    The last few years are not representative of the long term. Over the long term stocks, bonds and real estate - in aggregate - rise in value. If you don't want to risk short or medium term fluctuations and black swans, the ultimate traditional and safe investment is a savings account. If you're the type that thinks fiat currency is only worth it's weight in toilet paper, then buy gold. For any of these investments you'll have more left at retirement than if you put 100% of your capital into startups that ended up going out of business.

mikeryan 14y ago

But this allows an average well-informed SF employee to invest $1,000-2,000/month of his/her salary into any startup they like - hardly a life changing amount. See it as a Kickstarter on steroids. At least this gives us a chance too to invest in the next Dropbox and Airbnb. These aren't "ordinary" people? This model's only barrier to entry is the $1k it takes to get in (AFAICT) its not limited to "well-informed SF employees".

aaronbrethorst 14y ago

> At least this gives us a chance too to invest in the next Dropbox and Airbnb. And the next Webvan, Pets.com, Kozmo, Flooz, eToys, Boo, etc etc etc, saying nothing of the huge number of failures we don't even know about.