You'd Like to Be an Angel Investor? Here's How You Can Invest In My Deals…

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Most deals get done in informal settings. Now, I’m inviting you to join me. (Photo: Russell Yip)

 

Please note that my syndicate investing in Shyp has now closed. You can still back me on AngelList to gain priority access to future deals. More updates will be posted here later in the round.

 

On September 23, 2013 (that’s today), the world of startup financing changes forever. It’s a truly historic moment.

Previously, I couldn’t publicly share deals with you. Now, thanks to an unprecedented legal change, I can offer a portion of my start-up investments to any of you who qualify as “accredited investors.”

  • Previously, you had to be part of a small club to see such deals. Not any more.
  • Previously, you might even need to be in Silicon Valley, drinking wine and having coffees around the clock, to see good deals before they filled up. No longer.

Starting today, I’ll share some of my favorite deals with you, beginning with a start-up called Shyp.

Notable companies I’ve advised include Uber (pre-Series-A), Evernote, Automattic (WordPress.com), Shopify, and TaskRabbit, among others. Early investments include Twitter, Facebook, Reputation.com, etc.

In this case, I used a “Spearhead Capital” blog post to my ~1.4M monthly blog readers to find promising startups. Nearly 400 companies applied, many of which are producing millions in revenue. Out of all of them, and with the help of Naval Ravikant (CEO/co-founder of AngelList) to interview finalists, I chose Shyp.

Shyp is the fastest and easiest way to ship packages. More on that shortly.

Investing alongside me–and potentially you–in this round are:

  • David Marcus (President of PayPal)
  • Brian McClendon (Founder of Google Earth)
  • Daymond John (Founder of FUBU, Shark on ABC’s “Shark Tank”)
  • Joshua Schachter (Founder of Delicious, Tasty Labs)
  • Aaron Batalion (Co-founder of LivingSocial)
  • Homebrew (Hunter Walk and Satya Patel)
  • Naval Ravikant (CEO/co-founder of AngelList)
  • Scott Belsky (Founder and CEO of Behance)
  • Sherpa Ventures (Scott Stanford & Shervin Pishevar)
  • Antonio J. Gracias (Board Member at Tesla and SolarCity)
  • XG Ventures (Andrea Zurek and Pietro Dova)
  • Osama Bedier (Former head of Google Wallet)

…and more

So, how can you join us?

Before I tell you, remember:

  1.  Startups are speculative, and this is gambling. You shouldn’t invest anything you’re not comfortable kissing goodbye. Treat it as casino money.
  2.  If you are going to invest in startups despite this high risk, plan on building a portfolio of dozens, very slowly and carefully. This should be just one of many. Read more on approach here.

The Short Version

If you’d like to invest in Shyp, simply click here.  A description of the company is in “The Longer Version” below.

You’ll need to set up an AngelList profile (free), and the minimum investment is $2,500. We’re only able to accept $250,000 from everyone.

For more on the team and concept of Shyp, click here.

If you miss this one, not to worry–you can automatically join my deals in the future, which puts you first in line next time.

Can’t invest right now? No worries. If relevant, I’d love for your to consider any of the below actions. Shyp and I would really appreciate it!

- Apply to be a Shyp Hero (Heroes are Shyp’s drivers). Click here.

- Apply for a job on Shyp’s core team. Click here.

- Interview the co-founders of Shyp: Kevin, Josh, and Jack. They’re clever gents. Just email: founders at shyp dot com.

- Tell Shyp which city you live in so they can launch there before others!

The Longer Version

I’m putting my name and network behind Shyp and personally investing $25,000. I’ll also be providing oversight and advising the company on product/conversion optimization, national launch strategy, etc.

I’m using a new AngelList feature called “Syndicates” to share my $250,000 allocation of Shyp.

Unlike venture capitalists (VCs), I am charging zero management fees. If you don’t win, I don’t make a dime. If you invest alongside me, the only expense is a 20% “carry” (roughly 20% of the profits) if there’s a good outcome.

DESCRIPTION OF SHYP

Shyp is the fastest and easiest way to ship packages.

Through the Shyp iPhone app, you take a photo of what you want to send, specifying destination and pick-up time. You’re done.

A “Shyp Hero” (driver) arrives at your home or office at the specified time, takes your unpackaged item away to be packaged, then sends it on its way via the optimal carrier (i.e., Fedex, UPS, etc.). Shyp automatically optimizes for speed and cost, and Shyp charges no more than Post Office prices, plus a $5 pickup fee for sending solo items. If you send more than one item, the company waives the $5 pickup fee.

More on how this works below the video.

I have confidence in the team, and here’s why I love the model:

- Recurring revenue. It has a frequent use case, just like Uber and Evernote (again, both of which I’ve advised). Millions of people can use Shyp on a weekly or daily basis.

- It’s simple and solves a real problem. Do you enjoy going to the post office or UPS store? Scheduling pickups that require you to be available for 3-6 hours? Of course not. Shyp makes fixing all that as easy as snapping a picture. And they package everything for you. No more wasted afternoons.

- It has unusually high margins. Shyp matches USPS retail prices, but by taking a volume discount from carriers and utilizing regional couriers (that end-users cannot), Shyp can maintain high profit margins. Using OnTrac, as one example, is 75% cheaper than USPS.

- It’s tackling the “first mile” problem, not the “last mile” problem. Lots of companies are focused on same-day delivery from retailers to consumers: the last mile. It’s a crowded battlefield of a market. But what about the burden of packaging up shipments from homes and offices? This “first mile” problem is enormous, and the market is neglected. Shyp aims to own it.

How to Get In First

Would you like first access to my future deals, right alongside my close friends?

To see things before I post them on the blog, you can automatically back me on AngelList, as Naval (CEO of AngelList) and others are doing. Click here for more details. This will ensure you don’t miss anything.

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DISCLAIMERS — DON’T SKIP:
Startups make big plans a lot, and most don’t follow them. Shyp might run out of money; customers might not like using a third party to ship things; UPS, Fedex, or some upstart could start competing; or the team could simply fall apart tomorrow. Any statements about their future plans, margins, etc., are pure speculation on my part. That’s why startup investing is very risky, so again: don’t invest anything you aren’t prepared to write off 100%. Last but not least, I’m not necessarily planning on sending frequent updates or notices of Shyp’s change in plans (if any), as startups change on a weekly or daily basis.

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Exclusive Warren Buffett – A Few Lessons for Investors and Managers

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“This [drawing] looks good — as close as I’ve ever look to George Clooney.” – Warren Buffett. (Illustration credit: Monica Bevelin)

“It’s a funny thing about life; if you refuse to accept anything but the best, you very often get it.”
-W. Somerset Maugham
English dramatist & novelist (1874 – 1965)

I have long been a fan of Warren Buffett, who is widely considered the most successful investor of the 20th century. His net worth is currently estimated at $44 billion.

The fascination with his approach to value investing started with Buffett: The Making of An American Capitalist, which led me to devour all of Buffett’s incredibly readable annual letters to Berkshire Hathaway shareholders. My fervor culminated in early May of 2008, when I made the pilgrimage to Omaha, Nebraska to elevator pitch Buffett and Charlie Munger directly in front of 20,000+ people (See: “Picking Warren Buffett’s Brain: Notes from a Novice”).

Prompted by all the “Mr. Market” manic-depressive excitement about Facebook, tech, and the world at large, I’m thrilled to offer an exclusive excerpt from a new 81-page book: A Few Lessons for Investors and Managers from Warren E. Buffett.

In it, author Peter Bevelin distills hundreds of pages of annual reports and Berkshire’s An Owner’s Manual into bite-sized principles and key quotes. Of this lightweight handbook, Buffett himself says, “It sums up what Charlie and I have been saying over the years in annual reports and at annual meetings.”

Net proceeds from sales of A Few Lessons are donated to the California Institute of Technology in Pasadena, California. It can be bought at the publisher’s site, which is their preference, or it can be found on Amazon.

For this post, I’ve chosen one of my favorite chapters, which relates to Buffett’s criteria for investments (and acquisitions): Business Characteristics: The Great, the Good, and the Gruesome… Read More

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How to Create Your Own Real-World MBA – II

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Brainstorming in Boulder, CO with a class of founders from TechStars, where I’ve been a mentor. After this particular trip, I ended up advising Graphic.ly. (Photo: Andrew Hyde)

Disclaimer: nothing on this site is legal advice, and I am not an investing expert.

This post is continued from Part I.

Part I explained how, instead of getting an MBA, I invested the tuition dollars into angel investing. To recap, my current stats for the two-year “Tim Ferriss Fund” look like this:

15 or so total investments
0 deaths
2 successful “exits”, or sales (including my own company)

If we look at the value of my remaining start-ups on paper, based on subsequent funding and valuations, the portfolio is probably up well over 4x. This means nothing (remember Webvan?), but it’s fun to look at the spreadsheet.

This post will look at how I’ve found deals, how I filter deals, and the rules I’ve set for myself. The latter can teach broader business lessons, even if angel investing never enters your life… Read More

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How to Create Your Own Real-World MBA

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(Photo: DavidDMuir)

It’s fun to think about getting an MBA.

They’re attractive for many reasons: developing new business skills, developing a better business network, or — most often — taking what is effectively a two-year vacation that looks good on a resume.

In 2001, and again in 2004, I wanted to do all three things.

This post is the first of two that will share my experience with MBA programs and how I created my own… Read More

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The Psychology of Automation: Building a Bulletproof Personal-Finance System

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Actor faces

Too many choices. Using automation to reduce choices and dominate your money.

I have known Ramit Sethi for several years now, first through PBWiki, which he co-founded, and later as someone I turned to with questions about the world and workings of finance. In a world of gurus who promote one method of investing and then follow another, it was refreshing to talk with someone who was willing to share real numbers and case studies from their experiments.

Ramit and I have also able to share a bottle (OK, many bottles) of wine and laugh about the downstream effects of titles we’ve tested and chosen, as both of our book titles sound like scams to most people: The 4-Hour Workweek and I Will Teach You To Be Rich.

Despite this self-imposed handicap, Ramit’s blog and advice have been featured in media such as NPR, The New York Times, and Fortune magazine. I specifically asked him if I could excerpt a few of the diagrams and call scripts from his new book. He and I both share a love of templates that enable us (and others) to duplicate results without reinventing the wheel… Read More

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How to Be Jason Bourne: Multiple Passports, Swiss Banking, and Crossing Borders

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Is it possible to become invisible without breaking the law? (Photo: gravitywave)

LOS ANGELES, MID-JUNE 2008

Sitting on a plush couch in the neon-infused nightclub, I asked again:

“What’s it about?”

Neil Strauss glanced around and looked nervous, which I found strange. After all, we’d known each other for close to two years now. In fact, he was – as New York Times bestselling author of The Game and others – one of the first people to see the proposal for The 4-Hour Workweek and offer me encouragement.

“C’mon, dude, give me a break. Don’t you trust me?”

“Guilt. That’s good. Use guilt,” Neil said. But the Woody Allen approach wasn’t working.

“I can’t let the meme out early” he said, “I trust you—I’m just paranoid,” he offered to no one in particular as he downed another RedBull. So I fired a shot in the dark.

“What, are you writing about the 5 Flags or something?”

Neil’s heart skipped a beat and he stared at me for several long seconds. He was stunned.

“What do you know about the 5 Flags?”

I was in.

The 5 Flags

Neil’s new book, Emergency, teaches you how to become Jason Bourne.

Multiple passports, moving assets, lock-picking, escape and evasion, foraging, even how to cross borders without detection (one preferred location: McAllen, Texas, page 390)–it’s a veritable encyclopedia of for those who want to disappear or become lawsuit-proof global citizens… Read More

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Rethinking Investing – Part 3 – Spotting Mistakes in Jon Stewart vs. Jim Cramer

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The Daily Show: Jim Cramer Interview – Hulu. Having trouble? Try installing AnchorFree, and if that fails, get a taste with this clip.

The unanimous conclusion after stockmarket pundit Jim Cramer appeared on The Daily Show with Jon Stewart last week was: Jim got his ass kicked.

Be that as it may, were the facts straight? I will defer here to Mark Hanna, Trust Officer at Clayton Bank and Trust in Knoxville, TN. I first met Mark at the 2008 Berkshire Hathaway Annual Shareholder’s Meeting, where he was wearing a manager badge and discussing complex financial instruments.

Clayton Homes
was sold to Berkshire Hathaway in 2003, and founder Jim Clayton hired Mark to start a Trust Department within his bank — Clayton Bank and Trust — to manage proceeds from the sale. Mark didn’t want me to share his personal annualized track record, but trust me: it’s phenomenal… Read More

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Rethinking Investing – Part 2 (Plus: Election Thoughts)

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Successful “investing” requires some uncommon questions. (Photo: Me at Burning Man ’08)

“If the market felt fidgety, if people were scared or desperate, he [senior Salomon Brothers bond trader] herded them like sheep into a corner, then made them pay for their uncertainty.”
-Liar’s Poker, Chapter: A Brotherhood of Hoods

Connecticut, 2003

There were 4-6 screens per person, and chairs were lined up at a single 30-foot desk in hierarchical pecking order. Commands would come down the line and trades were made.

“Who the f*ck are you?” asked one of seniors, swiveling back to his glowing screens before I could answer.

It was my first time inside one of the largest investment banks on the planet, and I was just observing a friend in the hopes of learning something. Before I knew it, lunch had arrived and a 20-minute break was announced in a poetic slew of 4-letter words.

“Name a company.” It was a voice I didn’t recognize, but it was clearly directed at me.
“Uh… sorry. Excuse me?” I asked to the room and no one in particular.
“Name a company.”
“Uh…”
“Any company — doesn’t matter.”
“OK. Ah… Genentech.” It was a shot in the dark with no rhyme nor reason.
“F*ck Genentech!!!” came the chorus.

“OK, we just sold 100,000 shares of Genentech. F*ck those guys. Lost a ton on them last week.”

100,000 shares of Genentech sold because a no-nothing guest had pulled the name out of thin air.

That was my introduction to how truly rigged the stock market is… Read More

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Rethinking Investing: Common-Sense Rules for Uncommon Times

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I first saw this video at the May 2nd, 2008 Berkshire Hathaway shareholder meeting. Prophetic and not to be missed.

I’ve learned quite a few things in the last 18 months of exploring—and experimenting with—the world of investing. This post is my first attempt to share the findings.

The lessons have come from not just reading books, but trial and error, and picking the brains of some diverse and fascinating people:

-Warren Buffett, the richest man in the world, and CFOs/financiers at Berkshire’s portfolio companies
-Chief economists at top investments banks
-Dot-commers who have turned $40,000 into $2,000,000 in stocks using massive leverage
-Conservative entrepreneurs (still self-made millionaires) with all-bond portfolios
-Money managers of the ultra-rich and ridiculously famous
-Ivy league professors who not only trade options exclusively but also bet up to $500,000 per night as no-limit hold ‘em poker players.

In all cases, excluding blog reader feedback (how could I know?), the principles I will offer are from people who have made millions in their respective investments, not armchair quarterbacks (advisers) who take a management fee from the people willing to take real risks… Read More

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Investment Series Preview: The "Good Bye and F__k You" Letter

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Is this a hedge fund manager? (photo: dannyhammontree)

I’m in the process of preparing a series of posts on the investment lessons I’ve learned in the last 18 months.

To preface the series with some humor (and insight), I thought one particular farewell letter would be appropriate. The author is hedge fund manager Andrew Lahde, who produced a one-year 866 percent return betting on the subprime mortgage collapse.

Today, he announced he was leaving the hedge fund business with a rather hysterical letter… Read More

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