179: 8 Things Sam Marks Has Learned from Startup Investing


Sam goes over the top 8 things he has learned from investing in startups. Sam has invested in 9 startups in the last 8 years and has seen 3 exits and/or partial exits in the last six months. He’ll go over the process of investing in a startup, what to look for and what to avoid as well.

Where we are:


Like these investments? Try them with these special ILAB links:

  • ArtofFX – Start with just a $10,000 account (reduced from $25,000)
  • Fundrise – Start with only $1,000 into their REIT funds (non-accredited investors OK)
  • Betterment – Get up to 1 year managed free
  • Wealthfront – Get your first $15,000 managed free
  • PeerStreet – Get a 1% yield bump on your first loan

*Johnny and Sam use all of the above services personally.

Time Stamps:

  • 06:04 – What do you look for in a start-up?
  • 08:52 – Is it more important to have the management in place than what the company actually is involved in?
  • 12:23 – Is international diversification important in your selection?
  • 13:39 – How do you determine how much you are willing to invest?
  • 14:28 – Are the Start-ups similar to how “Shark-Tank” portrays?
  • 19:06 – #1: Companies take a long time to build and exit
  • 22:05 – #2: Start-ups require more money, that initial investment is not the last investment.
  • 26:15 – #3: Expect big dilution
  • 32:52 – #4: Founder issues are common protect yourself against it
  • 38:48 – #5: Cap tables becomes big issues for mediocre companies
  • 45:10 – #6: Raising money is not the goal, creating value is
  • 47:56 – #7: Valuation isn’t important necessarily, what’s more important is your entry point and exit point.
  • 53:55 – #8: Nothing is a sure thing until the money is in your bank account
  • 59:09 – What advice would you give to a beginner getting into a start-up?
  • 63:25 – About how long is expected for the second round of investment?
  • 65:16 – What should you look for in an attorney to look over the investment paperwork?
  • 66:41 – What other ways can you be valuable to the company?

If you enjoyed this episode, do us a favor and share it! Also if you haven’t already, please take a minute to leave us a 5-star review on iTunes and claim your bonus here

Copyright 2021. All rights reserved. Read our disclaimer here.


Liked it? Take a second to support ILAB on Patreon!
Become a patron at Patreon!