Wealth Building & Investing

Are you looking to invest in startups but you aren’t sure what to look for? How do you determine if a startup is a good investment idea? How do you know it’s the right thing for you?

When you want to invest in startups there are plenty to choose from. Almost all startups need money. That’s why it looks like a promising investment sector too many.

It seems so easy, find a startup. Invest your money. Watch them grow and multiply your money. But, in reality, it isn’t quite that easy.

Not every startup will be the next Uber. Not every startup succeeds and grows rapidly. Often it’s hard to tell if their product and offer are any good.

That’s a problem because if you are investing in a startup you want to make sure it pays off. You want to get returns on your investment sooner or later. Investing in the wrong startup can be a risk.

And there are also other factors you have to consider before you put your money into anything. So before you go ahead and invests your money into a startup, check for these 5 crucial things first.

1. Is There A Hungry Market for Their Product?

Before you invest in startups you want to make sure there is an actual market for their product or service.

Let’s imagine you can choose between startups. One has an advantage in capital, on has the best product or service, another one has the best team. Or maybe they have the perfect timing or the latest technology. Which one would you choose?

If I would invest in a startup I would always choose one thing: A hungry market. I would choose that every. single. time. Click To Tweet

Their product or service might change, but a hungry market will always buy from them.

So many startups fail because they focus so much on their product or service. But they completely forget about their customers. They focus more on their own needs than on the needs of the marketplace.

They put all this effort into building the perfect product…that nobody wants. Instead of their product, look at their offer. What is the irresistible offer that they bring to the marketplace?

An offer contains their product plus the value. If the perceived value is high enough people will want to by. You can imagine the offer almost like a bait. Like if you go fishing, you want to choose the right bait. So the fish would actually bite. Using a stone as a bait won’t do you any good. You have to understand what they want.

Why Is The Market So Important?

So many startups make one mistake. They offer what they think the market wants. Instead of finding out what the market actually wants.

You only want to invest in startups that actually have an irresistible offer of some kind. It should be more than a crazy idea in their mind.

Save yourself from investing in startups that spend years on things that nobody wants to buy. As sad as it is, that happens too often. 8 out of 10 businesses fail after 20 years. Half a million businesses are created every month. 30% of those go out of business within two years.

What to Look for in a Market?

You also want to check how big the market is before you invest in startups.

Is it a very local market only in the direct neighborhood? Or is the market the whole world?

Don’t get me wrong the market doesn’t have to be huge for them to be successful. But it has to be some good size so they can expand later. Simply put, is the market big enough so their offer is scalable? What are the chances of this offer getting bought now and also in the future?

And finally, when it comes to invest in startups, there is one more thing about the market. How saturated is it? Are they targeting an existing market with lots of competition? Or a completely new one?

What if their chosen market is very competitive? Do they have a defining factor that makes them different? How is their solution different from existing ones and is there a market that needs that? There is also the question of how powerful their competition is.

I once had a guy tell me he wants to start a coffee company and compete with Starbucks. How can a small startup compete with a huge chain?

Of course, the founders are very passionate about their ideas. But you have to stay cool and check if their business actually makes sense.

What to do if you invest in startups that market to a completely new market? You have to make very educated guesses if it is possible. Will the market be big enough? Is the crowd hungry for this?

2. Do They Have Some Money Already?

When you invest in startups, you don’t want them to fully rely on only your money.

If they can only start out because of your investment, that’s actually very dangerous. If they need your money so urgently, the founders aren’t entrepreneurs yet.

Making money from business takes time and effort. If they expect to find one single investor (you) and suddenly make all the money…they don’t understand what it means to have a business.

Building up a successful business needs time, effort and money. You don’t create a startup because you want to work less and hate your job. If you do that, your business will fail.

That’s why I advise all my students to take care of their cash flow needs first. First, they need a stable income. Only then they should even think about becoming an entrepreneur.

So, if you want to invest in startups what out. Pick those that have a great work ethic and are resourceful enough to generate money –  before they are looking for investors.

There is nothing wrong with looking for investors, but it can’t be their income stream.

How resourceful are they?

Their resourcefulness to getting money shows you what they are willing to do in order to succeed. Do they tilt because an idea didn’t work? Or are they looking for solutions and create results?

Believe it or not, there are startup founders that only want to put their money in after the startup has reached in size. They don’t have any skin in the game. Rather, they try to build their business and get wealthy by a miracle.

They have this idea and think it will make them rich. But a business without money is just an idea…it’s not even a startup.

So don’t get swooned owner by fancy looking business plan and market analysis. Those are great things to have but if there is no starting capital, how will they succeed?

I’m very careful about such things. You don’t want them to run off with your money. You want to invest in startups that are resourceful enough to have some money already. Your investment might help them to get more scale.

Being resourceful also means they don’t lose hope after hearing no several times. They have the stamina to go on because they know there is a demand for their product or service.

3. Are Their Team Members Complementing Each Other?

The next crucial thing you want to look for before you invest in a startup is their team.

Before the investment, you will likely get in contact with the founders of the startup. You will discuss the strategy, business plan and other things.

But I highly advise you to also have a look at their team. Who else is working on the startup? What skills do they bring to the table? And, likely most important, how do the founders lead their team?

Are their skills working together? Do the founders mentor the teammates? Do they really have successful chemistry?

All these are pointers to look out for. The team is an important metric to measure the success of a startup.

But, you only want to look at this, after you’ve checked the market! Again, the best team in the world won’t help, if there is no hungry market for the product.

If they have the market and a great team, those are good signs to invest in startups.

Some startups have quite small teams because they are saving on costs this way. But they absolutely need people in all the key positions, so the whole business can actually run.

What Does a Great Team Look Like?

Their team has to be able to execute. Too many founders try to get everything done themselves and give no trust to their team. Instead of delegating they work tons of hours to get everything done.

When really, all their team members should be experts in their field and get the job done themselves. They should also have some operating systems in place already. That shows they are serious about this business. Do the founders have the vision while the team is taking big parts in executing that vision?

Another very important thing: don’t invest in startups that don’t have an expert on their niche on their team. Let’s say the startup is a lead generation agency. But nobody on the team ever worked with lead generation. All they do is guessing how it works…How likely will that team succeed?

A well-built team should have the skills that the founders lack. They are balancing each other’s strengths and weaknesses. You don’t want to invest in a startup where all team members have the same skills. It means they have huge weaknesses too.

4. Did They Create Results Already?

This is another great point to look into before you invest in startups. Did they already get in contact with their market somehow?

Are the customers already engaging in with the product? Maybe there were some test runs and the testers are giving feedback. Or maybe the founders did a survey of what customers expect a certain product to do.

Looking at this shows you how serious the founders are. Do they just have ideas or are they willing to execute? Are they still working on the basic concept or are they already developing tangible results?

Are they committed to making this happen and work out for them? Or is it just an idea and if it doesn’t work they jump onto the next idea?

If you get in contact with them and they want to win you over as an investor,

watch out if they can present any real data. Does the data support their idea? These early calculations are a great proof of concept.

So what does a promising startup look like? They have a hungry market and some data collected already. If they have the data but the market is non-existent or too small you don’t want to put your money there.

When it comes to data, also make sure that their measuring is actually realistic. Some startups run into the trap of measuring too much. Or the use numbers too early. While data is important, it’s not the only factor that determines their success (and as a result the success of your investment).

How do Others React to their Idea?

A great way to see if the startup’s offer creates the desired results is this:

Show it to strangers on the street and see their reaction.

If they say “ok, yeah that’s good” then the idea actually isn’t good! You want them to go “wow this is great, where do I buy.”

If the offer can’t win over people, it won’t stand a chance in the marketplace.

4. Are You Actually Ready?

The final thing you want to consider before you invest in startups is a little bit different.

It’s less about the startup, the founders, the product or even the market…

It is about you. Are you actually ready to invest in startups?

To invest in startups might sound like a good idea but it’s only one investment type of many, many more. So, ask yourself why you want to invest in startups. Click To Tweet

Are you actually passionate about startups? Are you an expert on the field? Or did you just hear about other people who successfully invested in startups? Are you looking for a quick way to get rich?

The problem with that is that, if you suddenly jump into investments without knowing anything about it, you are taking huge risks.

You risk making a mistake and losing all your hard-earned money. I’m not saying investments are a bad thing…I’m saying investment without knowledge is not a very smart thing to do.

See, wealthy people, invest in what they understand. And they have their ways of checking and evaluating if an investment is a good idea.

If you don’t know how to successfully invest in startups – and only do it because it worked for others – reading a few blog posts about it won’t help you much. So what should you do?

How To Prepare Yourself for Any Investment

Before you invest in startups – or do any other investment really – you want to do a few things.

First, you can’t invest if your daily cash flow needs aren’t met. Meaning, if you don’t have enough money to pay your bills, you aren’t in a position to go out there and start investing. Raise your income first (have a look hat I teach about high-income skills).

Now you want to be in a position where you can invest at least a few hundred bucks. And lastly, really understand which investment type suits for you. What do you really like? Is it really startups? Or stocks, or real estate?

I personally love two types of investments. Investing in myself and real estate. Why? Because I understand it. I would never advise anyone to invest in something they don’t understand.

What if I told you there is a chance to learn the investment strategies of the rich?

My fans and students kept asking me about investments. When to do it, how to do it right and so on. Exactly for that reason, I’m offering a once in a lifetime event. What is it about? It’s called “Secrets Of The Rich” and it will take place from February 23rd to 24th.

The rich have these crazy strategies that give them stable returns – sometimes up to 24%. Those investments are low-risk and high-return. But you can’t find it in any book and it’s not taught at seminars. At least until now.

The event is really a once in a lifetime chance. It’s unlikely that it will ever be repeated. If you want to educate yourself on investing as the rich do, this is your chance.

Unfortunately, the event is now sold out. But I have a special offer for you. You can get lifestream access that comes with a full recording too. This way you can learn the investment strategies of the rich, even if you missed out on the seats.

Check out the details HERE.

Investment strategies are risky, right? It’s a common belief that all investments are risky, but maybe that’s only if you don’t understand what you’re investing in.

On the news, you hear about investors who lost all their money. On TV shows they show you the downfall of the successful CEO because he got greedy and invested too much.

But surprisingly, only people with a “poor” mindset believe that investments are always risky. What do I mean by a “poor” mindset? I’m referring to people whose thinking and belief systems are very limited. They see competition everywhere, and are afraid because their resources are limited.

Wealthy people, on the other hand, live in abundance. They know they have more than enough resources to make mistakes.

The thing is, once you reach a certain income, the whole investment world suddenly opens up to you.

Before, you weren’t able to invest. Why? Because you were focusing on making a living. Once you reach a certain income, you have more money than you need to live comfortably. That’s the money you use to invest.

You take that “extra money” and use it for investments. If you don’t have a lot of extra money, maybe you do need to be more careful about what you invest in.

I recommend you learn about investment strategies. Do so before you put a single dollar into something that you don’t understand.

Investment is in fact, risky, if you have no idea what you are doing. If you are new to investing, or you don’t understand what you’re investing in, it can be risky.

You hear that other people got a great return on their investment doing this or that. Immediately, you try to do the same. But how do you know that your source is credible? How can you shield yourself from investments that are too risky?

Rich and wealthy people have been doing this for some time. They know how to play the “investment game” – and what to avoid.

That’s why today, I want to go over 5 investment strategies wealthy people use to minimize risks.

Investment Strategy #1: Only Invest In What You Understand

Even in the investment sector, there are new fads and trends. Many people would hop on to those trends and try to make money fast.

There are so many people looking for the fastest way to get money. They get caught up in the newest gimmick…

On the news, they hear that people got rich with Bitcoin. They instantly try to do the same. Once that trend dies down, they will find the next one. But still, they lose a lot of money. It’s a very risky strategy.

I never ever invested in Bitcoin or any other trendy, gimmicky thing. Why?

Because I only invest in things I understand. That’s the foundation of my investment strategies.

Putting your money into something you have no clue about – that’s risky.

Even if it worked for others. To make it work for you, you have to understand it.

So, if you are completely new to the investment world, you might want to learn at least some basics.

Investing is a lot like playing a board game. If you don’t know the rules, you can’t play. And you most likely won’t win.

So rich people only invest in what they truly understand. Most wealthy people, they understand stocks or real estate investments.

I personally always prefer real estate, because I can control parts of it. I know the rules of the real estate investing game. That allows me to predict and avoid most risks.

Why You Should Invest in Stocks or Real Estate

Stocks and real estate seem to be the favorites of most wealthy people. Why is that?

Because they produce a high-return. If you invest in something, you want it to be worth it. That’s why high-return investments are best.

So, while a person with a “poor” mentality would invest in whatever they get their hands on, wealthy people invest in what they truly understand. They are immune to trends because they are patient.

The rich don’t care about the short term wins of trendy cryptocurrencies. They look for long-term, high-return investments.

The Problem With Trends Like Bitcoin

I personally don’t like the latest investment trends. Why? Because it’s not stable.

They promise you fortunes but the investment is actually risky.

Also, I don’t know enough about it, that’s why I would never invest in it.

Most of those trends die down eventually and the investors lose quite some money.

Investment Strategy #2: Evaluate Before You Invest

The next one of the investment strategies of the wealthy is this: they know how to evaluate an opportunity.

If they get offered an investment, they don’t jump on immediately. They evaluate first.

They know what to look for and check if the investment would be too risky.

Being a good investor means you turn down a lot of chances.

You don’t blindly hop onto every single opportunity.

Wealthy people are patient. They take a step back to think about it. And then they take the right decision.

I personally refuse almost 99% of my investment opportunities  – because I know exactly what I’m looking for.

I learned what to look for in an investment. Those pointers will tell me how risky it is.

Learn The Language of Money

Rich people speak the language of money. They know how to read financial statements. They understand tax systems.

If you are new to this, you might feel overwhelmed. But it’s learnable.

You don’t have to become an accountant to understand all this. But if you want to make money, you have to understand how it works.

But that’s why I recommend not to jump into the next best thing. Take your time to understand what you are doing.

So, what can you do? You should get familiar with the financial language. Common words like “interest rates”, “mortgage”, “bonds” and so on…

I call this “financial literacy.”

In day-to-day life, you need to be able to read so you can navigate yourself. Imagine you wouldn’t be able to read…what would that mean? You’d blindly trust others and hope they don’t betray or scam you. You would be pretty helpless in some situations.

It’s the same in the financial world. Without financial literacy, you are helpless. You might overlook important facts or evaluate the risk on investments all wrong.

Poor people jump right into the investment. Wealthy people learn vocabulary first. Poor people try to wing it. The wealthy evaluate, learn and act. They follow the strategy of evaluating before investing.

Investment Strategy #3: Have Some Money Ready

To invest you need a bit of cash that you can spend freely. So, ideally you have some money on the side that you use specifically for investments.

This money should be extra cash. Don’t go out and spend the money you need to secure your daily living.

How much money you need will depend on what kind of investment you want to make.

In real estate, there are ways to start out with a few hundred dollars. That’s why I like real estate. You can start quite easily and still get high-returns.

For other investments, you might need a bit more money.

That’s why investing is a game of wealthy people. If you don’t have a stable income yet, investing can be extremely risky.

That’s also why so many people loan money from a bank so they can invest. I don’t recommend it as has a high risk. You don’t want to get yourself in debt.

If you have the cash, however, the investment will reward you with even more money. That again gives you more extra money for the next investment. You’ll only become wealthier and wealthier.

Where Do You Get The Money to Start?

Well, the common strategy would be to take on a loan. I don’t like that idea, however.

I firmly believe, if you can’t pay the money out of your own pocket – then you aren’t investment ready yet. You are still in the phase of building your living.

You need to work on your income first. There are two ways.

It can come from your business or your high-income skill.

Both can get you enough money. Once you live comfortably, you take that extra money and invest it. Then you only get wealthier and wealthier.

That’s why, once you reach a certain income, keeping it isn’t that hard anymore.

But make sure to get there before you start investing all your money.

Start Small

What most people get wrong is this: they think they have to invest huge sums of money. That’s actually not true. Investing is not about how much you put in, it’s about how much you get out of it. Click To Tweet

Some people who followed me for some time know the wealth triangle I often talk about. The natural order of the wealth triangle is: develop your skill – scale it – start to invest.

This is one of the investment strategies I suggest because it’s very safe. Normally, I would suggest starting investing, as soon as your skill pays you 10,000$ a month.

But, this is the point most people misunderstand. I’m not telling you to go ahead and invest 10,000$. I’m telling you to take a bit of that money and use it for investing. It’s great to start small.

If you focus on high-return investments, it’s possible to start with a few hundred bucks and get high-returns on that.

Let’s say you start small and invest 100$. You get back 120%. You just got 20% on your investment back.

Invest the money you have in things you can afford. Even if you don’t have 10,000$ a month yet, you can start out. Waiting gets you nowhere. Your actions will be rewarded.

The sooner you start, the better. Start building the habit of investing as soon as you can. The sooner you start, the better you will become fast.

To have what wealthy people do you need to be and think like a wealthy person. What habit do most rich people have? They invest. So start building that habit now.

Don’t wait until you are successful. Do it now and become successful.

Investment Strategy #4: Know That Investors Keep Secrets

Wealthy people don’t boast and brag about the ways they invest. Sometimes, they actually want to keep it from the public. They don’t want it to get too popular.

I was quite surprised when I learned how the wealthy invest in real estate. They are using strategies you can’t find in books or even on the internet. Nobody teaches these things.

For example, in North America they would use Tax Lien Certificates…hardly any investors ever heard of this before.

What Are Those Secrets?

You can imagine it like this. If somebody owns a property – like a house for example – they have to pay taxes for it.

Now, if somebody isn’t able to pay their taxes, the state is losing money. But that money is needed for public services like the police, hospitals, school, roads and so on.

So, the state wants that money fast. If you are an investor, the state allows you to basically buy these taxes – in the form of a Tax Lien Certificate.

You are not buying the real estate – only the Tax Lien Certificate that is attached to it.

Imagine it like you would pay somebody else’s taxes. Why would you want to do that? Because it allows you to receive all the outstanding money. But there is more to it…

The owner of the house has to pay certain penalty fees because he paid too late. Guess who gets that money? YOU – the investor who now owns the Tax Lien Certificate.

Now the way wealthy people invest in North America is just incredible. Their strategies are stable, no matter how the economy will change in the future.

Usually, they are making 24% on interest rates.

And the best part? You don’t need to live in North America to do this. Let me share more about that a bit further below…

They Invest Differently

Normally, when you invest in real estate, you need people to assist you. Like brokers and financial advisors for example.

But with the strategies of the ultra-affluent, you don’t need any of these people.

With these kinds of investments, your money is basically protected by the law.

But the public doesn’t really know this because rich people like to keep their investment strategies a bit like a secret.

If too many people know and use these strategies, the demand might get too high. Or the banks get angry and change things up.

That’s another reason why I don’t like investment trends. It’s so popular it will only work for a limited time. Once too many people hop on the trend it will break down.

So the best way to find less risky investments is to talk to other wealthy people. See why it worked for them and how it could work for you.

Investment Strategy #5: Invest in Yourself

One of the most important investment strategies of the wealthy, is to invest in yourself.

The rich aren’t afraid to invest money on seminars and courses. They know that they need to upgrade their skills and abilities. Only that way can you get and stay wealthy.

Investing in yourself is one of the safest ways. Why? Because, no matter the economy, you can always rely on yourself. Click To Tweet

You don’t pay any interest on your abilities. Once you mastered something, nobody can take that away from you.

When you have valuable skills you will always be in demand, no matter how good or bad the economy is.

So while wealthy people invest in other sectors, they also invest in themselves.

What are some great ways to invest in yourself?

• Read a book and implement your learnings
• Go through a training
• Visit a seminar
• Learn a new skill (preferably a high-income skill)

Are You Ready To Invest in Yourself?

Now, what if I told you that you can learn more about the investment strategies of the wealthy?

From February 23rd to 24th, I’m hosting an exclusive event. It’s called Secret Of The Rich – because we will go over the secret investment strategies of the rich.

This is your chance to learn more about Tax Lien Certificates. You can use these strategies even if you don’t live in North America. And you only need a few hundred dollars to start out.

You can view this as an exclusive chance to invest in yourself. The skills you’ll learn at Secret Of The Rich are yours forever. Nobody can take that from you.

There is one catch, however. The seats at the event are now sold out. But there were so many people who didn’t get a ticket, so I decided to offer a live stream. When you get a live stream ticket, you will also get a full recording.

At Secrets Of The Rich, you’re going to learn how to thoroughly review an investment before putting one single dollar into it.

You’ll know exactly what you’re getting yourself into. What your exit strategies are. And what you need to do to make this investment work.

So you’ll always be able to “look before you leap” so to speak. And that’s exactly what the rich do to minimize risk.

Find out more about the live stream HERE.