In the startup world, we have people we like to call “serial entrepreneurs.”

A serial entrepreneur is basically a startup founder who has ridden the entrepreneurial merry-go-round more than once.

That’s because founding a startup that makes it to a big exit is an extremely profitable (though grueling) endeavor. A really skilled founder can make hundreds of millions of dollars or more, doing just that.

That’s why, when I see a truly talented entrepreneur, I’ll often jump on the deal – even if I don’t quite “get” their business plan.

Take serial entrepreneur Jack Dorsey, for example. When he first started his business – a mobile credit card processing platform called Square – some investors weren’t so sure about the idea.

But they backed him anyway. Why? Because Dorsey is the man behind Twitter, one of the most successful tech companies of all time.

Trusting in the founder’s expertise turned out to be the right move. Today, Square is worth more than $30 billion.

Of course, even the greats come up with bad ideas sometimes. That’s why I run every single pitch through my 7-question gauntlet, which you can find here.

But a skilled founder knows the intricacies of steering a startup towards success, and that counts for a lot.

In addition to “street cred,” serial entrepreneurs have a Rolodex full of past investors, advisors, venture capitalists and board members.

And, since they all made money the last time they backed this founding team, they’re more likely than not to sign on again.

That’s because, in startup-land, it’s just part of the unspoken law: if an entrepreneur you backed rewards you with a big return, it’s good form to support them in their future endeavors.

On the other hand, if you’ve never invested in a startup before…

Backing an entrepreneur with a history of big exits is a pretty reliable way to succeed.

Until next time,

Neil Patel


Comments

16 responses to “Your Angel Investing Philosophy: Back the Jockey, Not the Horse”

  1. Does Neil have a list of startups that he can send out to us that he is investing in, or future startups that he himself is putting money in?

  2. you will get nothing but philosophy and for me that is all so far don’t know ware to start. Received a call from Kirin but missed it the call back No. does not work 866 310 1498

  3. Have read everything sent to me and am really ready to proceed, but have not figured out exactly where to start….still waiting for something in the mail that I can have with me all the time,

  4. I felt the same way, so I just would look at all the investment startup recommendation, then go with that, read all about them an click invest, then you set up an account with wefunded. First Then invest.

  5. Good afternoon, I was under the impression I was supposed to receive a kit a well. Haven’t received anything. I have invested in 4/5 startups thus far

  6. I’m new to all of this also. I did receive a nice welcome package with goodies in it & a book that I need to start reading. I’ve already completed my profile, linked up a bank account and I’ve jumped in to two investments and am on a wait list for a third. So all is going well so far. I’m pleased.

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