WhoBuilt

Startup Investor School Day 3

Mar 8, 2018· 1 h 5 min· 4.4K views·Watch on YouTube

Speakers

Jeff Clavier of SoftTech and Andreea Zurek of XG Ventures speak at Y Combinator’s Startup Investor School about angel portfolio strategy and building an investor brand.

Plan for risk and time

Clavier says angel investments are risky and can take eight to ten years to pay off; losses often arrive sooner. He recommends investing only money you can afford to lose and suggests treating 10% of net worth as a possible cap. He also advises setting aside the investment budget and spreading investments over time.

Build a portfolio deliberately

Clavier recommends defining check size, number of investments, sectors, stage, geography, and whether to follow on. He gives 10 to 12 investments per year and 35 to 40 over three years as one possible pace, while stressing that investors should choose a strategy that fits their means and expertise. Diversifying across sectors and investment years can reduce concentration risk.

Make your reputation useful

Zurek describes a brand as the reputation others associate with an investor, shaped by trust, quality, consistency, and integrity. She says investors can build that reputation by choosing a focus, responding promptly, following through, and offering practical help to founders. At XG Ventures, she and Pietro Dova drew on their early Google experience and aimed to stay accessible to the companies they backed.

Learn, adjust, and size checks with care

Zurek says angel investing involves mistakes, missed deals, and pivots; she recalls passing on Uber and advises investors not to take missed opportunities personally. In the Q&A, Clavier says conviction matters, while Zurek notes that some of her biggest winners began as smaller checks because she had reservations. They advise sizing checks with ownership goals and portfolio math in mind, and avoiding excessive concentration or direct competition among portfolio companies.

Takeaways

  • Set aside only capital you can afford to lose for years.
  • Write down your investment strategy so founders and referral sources know what fits.
  • Build trust by responding, following through, and being useful to founders.
  • Use portfolio math to set check sizes, and review concentration as your portfolio grows.

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