What is Investing? 🤔
"If you want to gamble, go to Vegas. Set a limit for yourself and be done with it. Don’t play with your future"
Before we even get into angel investing, let’s talk about what investing means as many in the community have expressed desire to learn about investing. That is why many of you have joined our community and signed up for this newsletter, right?
Yet, because of the plethora of information out there, sometimes it is hard to grasp what investing is all about.
I got into investing (or so I thought) while I was in in college. I had the very naive theory of buying into stocks that seemingly have a lot of potential without understanding the risk of the underlying security. Hence in the years of 2010 - 2014, I bought a lot of risky stocks such as BIDU, RENN, DDD, and of course FB (who here also got Zuck’d?).
Technology companies were going IPO left and right and social media and 3-D printing was all the hype. China was and still is growing leaps and bounds. What can go wrong?
Turned out, everything.
Much like Redditors buying into Stonks and SPACS today, I was also in the mix buying securities that were way beyond their fundamental value (for starter P/E ratio comparison can say a lot of things), and I failed to properly assess their risks (such as accounting fraud and when the hype winds down).
I remember buying DDD hoping that it will reach $100 and even talking about it on social media. It never did. That is when I lost my shirt. I had put everything into this stock. I thought DDD was going to revolutionize the world. NOPE.
I was destroyed. This is when it got me back to the drawing board. My entire saving was gone. Now I have to go back to eating instant ramen. When will I graduate from living in the basement?
This is when a friend of mine suggested to me:
“if you want to gamble, go to Vegas. Set a limit for yourself and be done with it. Don’t play with your future”.
With that, he also suggested that I read Four Pillars of Investing.
That is my journey of how I got started with “investing”.
Investing means many things to different people, but to me, it means patience and knowing myself. It means that I accept the fact that I will never beat the market because my information is never perfect. It means to see my own bias and not letting myself be swayed by hype. It means that there is no free lunch (not even free instant ramen).
What I learned is that to invest, you have to know what you are investing into. Investing means knowing about the asset you are investing into. What is the potential for growth? What are the drivers of growth? Can the underlying asset capture the growth and either perform on par or better than inflation? In the event of a disaster (such as a pandemic), can the asset still perform well?
Alternatively, the endeavor of investing for me personally is also to think about what kind of future I want as investing is a long game, and:
“Compounding is the most powerful force in the universe” - Albert Einstein
How did you get started with investing and what topics are you curious about? Email me at richard@iterativeventure.com
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Market View
**Note: These represent my opinion and is by no means an investment advice.
I am a bit worried about the inflation that is happening as I mentioned in our last newsletter. While it is great that the US government is printing money to support main street through this tough time, it is also concerning as there is more money in the market (Demand) while the real economy (Supply) is not at full capacity yet.
This only can suggest a few things in the next few months such as the increased asset and consumer price inflation that we are seeing. It also seems that Fed is not going to be raising rate until at least 2023 which means that this party will go on for another 2 years. (See here for more information)
So what? What’s to worry about? Inequality. And inequality can bring about instability such as during the dawn of 20th century with subsequent wars and revolutions etc. If you want to learn more, read this book.
Lastly, when the musical chair stops, don’t be the last one standing. Anchor yourself while you can.
Other Market Updates
2020 was a record year for Venture Capital fundraising, with nearly $80 billion of fresh capital, and this year is on pace to crack $100 billion but the game favors incumbent rather than newcomers - See source
Main street economy is rebounding: Spending at bars and restaurants in April was just 2% below the pre-pandemic peak on a seasonally adjusted basis, while spending at car dealerships and at electronics and appliances stores hit new highs, thanks to the money provided by the American Rescue Plan Act. - Barron’s
When borrowing is at record low and inflation is reaching record, it’s never a better time to borrow money. It’s almost like you are getting paid to borrow money (< 3% mortgage rate and 4.2% inflation rate = -1.2% …. 💥) - See source
Iterative Venture Updates
We are finalizing Upstock and Chaldal syndication! Please stay tuned as the deals will be published with memos via AngelList over the next few days.
Sign-up as an Advisor: Because many startups are also looking for advisors, please take a moment to complete the following form so we can reach out to you if any of our portfolio companies or prospective deals are looking for your profile!
Got deals? Would you like to submit any interesting deals and syndicate with us? Please submit your deal by clicking the button below. If the deal is successfully syndicated, you get 30% of the carried interest!
Upcoming Events
Subscribe to our Calendar: Please check our calendar as we will bring more educational materials to the group!
Deal-related
Other fun stuff
Being a PM @ Clubhouse by John Milinovich on 5/18/2021 @ 5:30 PM PST - RSVP
In case you have missed our past speaker series, please check out our Youtube channel!
We are also planning to bring in more education around angel investing so please stay tuned!
At the same time, if you have interesting topics to present, please sign up below!
Deals in the pipeline
If you are interested in any of these deals, please RSVP with the button below (while this does not guarantee your investment, it will put you in a priority list once we secure an allocation).
CareerNinja - Seed
India’s AI-powered personalized learning platform - First to use NLP & ML to create courses in <7 days and at 1/25th cost
10-30% M-o-M User Growth since launch in April 2020
3x in Revenue in 4 months in 2021; Gross margins of 74%
9000+ users learning across 50,000+ unique pathways
Current round led by Unitus Ventures is already 121% over-subscribed. Iterative Venture might get an allocation if there’s enough interest - please RSVP below!
Additional resource: Founders Pitch; Q&A; Unitus’s Thesis
Azteco - Seed
Consumer Bitcoin - the easiest and best way to buy Bitcoin through vouchers
Founded in May 2020, by a team of Bitcoin experts & product/ growth veterans from Google
$2.2M in total GMV (Gross Merchandise Volume) as of April 2021
$6k in Monthly Profit as of April 2021, 10x growth since the launch last June
NVISNx - Series A
World’s 1st Information Governance, Risk and Compliance (iGRC) platform
$2M in Revenue in Q1 2021, planning to grow 4x by Q4 with Series A in H2 2021
TAM (Total Addressable Market): $40B; Initial Market: $2.8B
Current customers include: Qualcomm, Universal Studio, Platform Science
Find more about the company’s sales strategy
Youtravel.me - Pre-Seed
Online travel platform utilizing proprietary algorithm that connects travelers based on their social interest, values, and past experiences
200,000 users per month and 3,500 travel experts on the platform
35% M-o-M growth in revenue during the pandemic
Graduated from the acceleration program 500 Startups Gerogia (Demo day)
Let us know how we did!
As we continue to grow and scale, we’d love to hear from you how we can be better and what you’d like to see more of. Want to get involved with the Iterative community? We’d love to have your help supporting the community. Please use the link below to give feedback & share your interest in joining our efforts.
Keep iterating 💪