Investment Portfolio Tips

Founders - Why Monthly Investor Updates Matter 📈 Of all of the challenging tasks on your plate, sending these updates is probably the easiest thing you can do to keep your company moving forward. Great founders shine through their communication rituals – with teams, customers, and investors. Crafting world-class investor updates is a high-value skill that can set you apart. How often do founders send updates? 👉 60% communicate monthly 👉 21% prefer weekly updates 👉 3% opt for daily communication 👉 16% stick to quarterly updates The Goldilocks Zone: Daily updates may not be the norm, but in extreme situations, they can be a game-changer. Quarterly updates, however, might be too infrequent. Monthly updates strike the perfect balance, with the flexibility to adjust frequency during crises or major changes. Key Takeaways: - Monthly updates are a must – consistency builds trust. - Be transparent; never dissemble. - Back your updates with data – numbers tell the story. - It's a narrative over time, not a one-shot report. - Make updates easy to scan and act upon. - Consider using a template (see photo) – simplicity is key. Feel free to use this template or create your own – the key is to keep the conversation alive and your investors engaged and informed on what's happening. #founders #startups #venturecapital #entrepreneurship

You gotta stop caving to recency bias. It's a pretty simple concept: You make decisions purely on what happens now versus what has happened historically. As a result? When new events happen, you're tempted to change course immediately as a result. And doing so can cause you to make decisions that contradict what you committed to. For example: - You make new investment decisions based on what happened the last week versus the last decade - You judge a teams performance based recent lost game than their record overall - You judge a product based on the most recent bad review despite it having mostly good reviews Now to be clear, this doesn't mean it's never true. But blatantly disregarding historical fact? It can be a recipe for bad mistakes. When it comes to investing, don't make that mistake. When you have a long term plan, stick long term. Don't make short term impulse on them.

When I was an early-stage investor, I was looking at all the wrong things when evaluating companies Surprise, a 24-year-old with no operating experience didn't know anything! Who would have thought? This is hands down the biggest epiphany I've had in the transition from early-stage investor to founder. I used to look at: 💰 Revenue and Revenue Growth 💵 What other investors had invested 🏛 Where the founder worked before 🤼 Team Size / Clout Now I realize most of these are either A) Lagging indicators that don't tell you much about the future or B) vanity metrics that actually mean nothing. With 3 years running Superfiliate, this has shifted entirely Not just in terms of how I think about our company but how I evaluate other early-stage companies as well Now, the things I think about that seem to actually have signal 🏗 Product Velocity - No one knows what needs to be built from the start. It comes down to your ability to talk to customers, learn the market, and quickly respond to what the market and customers tell you 🎉 Company Culture- Do people on this team wake up every day excited to help the company accomplish its mission? Is it a missionary or mercenary culture? Are top performers going to see the company as a place to build their career or a stepping stone to the next thing when they get a better offer? 💵 Capital Efficiency - Is the goal to raise money or build a successful, sustainable company? I think people miss the forest for the trees here 💎 Founder Tenacity and Market Fit - Are these founders the type that will stop at nothing to bring this into existence? Do they have an opinion on the market? Are they going to be able to avoid the pitfalls along the way and keep their heads down and build? Do these co-founders compliment each other? This is by no means an exhaustive list, and there is certainly some value in things like revenue growth, but the signal in an early-stage company's ability to drive returns is lower than I thought. I'd love to hear what other people think or have learned on a similar journey—bonus points if it's the other way around, from founder to investor!

One of the most concerning developments is the growing divergence between professional and retail investors. Institutional investors have quietly reduced risk, shifting toward defensive sectors and fixed income, while retail traders continue chasing speculative trades. Sentiment surveys confirm this imbalance, showing extreme bullishness among small traders, especially in options markets. With these risks building under the surface, prudent investors should proactively protect their portfolios. No one can predict precisely when the market will correct, but the ingredients for a sharp downturn are clearly in place. Savvy investors should use this period of complacency to reduce risk exposure before the cycle turns. Here are six practical steps investors should consider: ▪️ Rebalancing portfolios to reduce overweight exposure to technology and speculative growth names. ▪️ Increasing cash allocations to provide flexibility during periods of volatility. ▪️ Rotating into more defensive sectors like healthcare, consumer staples, and utilities that tend to outperform during corrections. ▪️ Reducing exposure to leverage by avoiding margin debt and leveraged ETFs. ▪️ Using options prudently—not for gambling, but for protecting portfolios through longer-dated puts on broad market indexes. ▪️ Focusing on companies with strong balance sheets, stable earnings, and reasonable valuations. ▪️ The explosion of zero-day options trading is not a sign of a healthy market. It is a symptom of an unhealthy market increasingly driven by speculation rather than investment discipline. Retail traders have moved from investing to gambling, chasing fast profits while ignoring the mounting risks. Greed is rampant, leverage is extreme, and complacency is near record levels. Markets can remain irrational longer than expected, but history tells us these speculative periods always end in a painful correction. Bull markets do not die quietly; they end with euphoric retail excess followed by painful corrections. Investors who recognize the signs early will avoid the worst of the fallout and be positioned to capitalize when value opportunities return.

One potential change to your investment strategy could be looking to earn royalties on investments as a minority investor rather than being paid a percentage of profits based on equity. For example, consider owning a 33% equity stake in a growing organic skincare company. You may agree on a gross revenue royalty, providing you with a share of revenue, which can be a better option than profit-based payouts. This approach encourages alignment, transparency, and accountability in your investment strategy. It also helps prevent you from being illiquid in a deal for a decade while you cross your fingers for an exit. If you can get at least your initial investment back as a royalty, you can recycle that cash into another deal and pick up another equity stake or upside - and it de-risks your transaction every month/quarter as you get capital back vs. waiting until profits are available or an exit happens. #investing #investments #capital #investorclub #familyoffice #privateinvestors #business #CFO #privateequity #CEO

I had pre-ordered Poor Charlie’s Almanack before Charlie Munger died & read it when it arrived. In the ten speeches that constitute the book, Mr. Munger reveals his frameworks for life. Mr. Munger was known for his worldly wisdom, a collection of mental models that helped him think about the world. Compound interest, confirmation bias, & something he calls the Lollapalooza effect - human psychology that shapes human behavior. Tulips, cryptocurrency, & cola all fit into this effect. Mr. Munger, like Atul Gawande in the Checklist Manifesto, lauds the checklist for eliminating bias through comprehensiveness. The book contains his for investing. In one of the speeches, he chides investors for spending too much time on the macro and not enough on human pyschology & incentives of individuals. He argues psychology is a broken field because we cannot run true A/B experiments with humans. It would be an ethics minefield. But it’s one of the most important & least well-studied forces in economics. Captain Cook deployed reversed psychology to convince his sailors to eat sauerkraut to avoid scurvy, by reserving it as a food first served to offices to change his mariners’ perception of it. Describing a hypothetical business case to build a $2t market cap company in the non-alcoholic beverage business, Mr. Munger steps through four basic ideas: trademark the brand, reverse engineer economics at scale, use human psychology to convince large numbers of people to drink the beverage (he discusses rewarding users, brand marketing, & establishing product ubiquity), & develop a unique flavor - knowing that in time it will be replicated or surpassed. And then he hits the reader with this zinger deploring the state of higher education : This would indicate that our civilization now keeps in place a great many educators who can’t satisfactorily explain Coca-Cola even in retrospect and even after watching it closely all their lives. This is not a satisfactory state of affairs. Mr. Munger is keen on synthesis. His definition of intelligence is being able to combine insights and mental models across different disciplines into a simple explanation. The Almanack is an embodiment of that idea. It marries brilliance with bromides to convince the reader to use checklists, mental models, & psychology to make sense of a very complex system : the business world.

I was over $35K in debt starting in sales in 2006. I retired from corporate selling as a multi-millionaire in 2022. I’ve had to learn things the hard way, so you don’t have to… “What’s your suggestion to investing my money right from the start?” This was a question I received from Elad, a 21-year-old new SDR. Here are my simple suggestions: → Invest your TIME learning from others. I love Jennifer Welsh’s simple financial and investing advice. → Invest your ENERGY in protecting it through healthy habits, like a professional athlete takes care of themself to perform well each day. Jeff Riseley shares excellent insights around prioritizing mental health for better sales performance. → Invest your ATTENTION in acquiring specific knowledge and new skills. Kyle Asay and Salman Mohiuddin have great frameworks and programs for early-stage sellers. - Invest your INCOME automatically. Stash (no affiliation) is an awesome way to invest in individual companies and markets automatically using a long-term approach. More income investing rules you can't go wrong with: → Develop a budget and make sticking to it feel like a fun game → Build 3 - 6 months income as an emergency fund (should grow as your responsibilities expand) in a reasonably strong yield account you can access easily when you really need it. Marcus by Goldman Sachs (no affiliation) earns 4.40% right now (better than a lot of big banking/savings accounts). With a little research, you might find even higher rates. → Pay your future self first (investments) → Pay your current self last (treat yourself, if there is anything left over) BONUS: If you’re just starting “to adult” and have a tendency to overuse credit cards, freeze them (literally in the freezer), and only live day-to-day on a pre-paid card or debit card. If there is something you want to purchase that can't be covered on the pre-paid card, wait overnight until the credit card freezes and then make the purchase. What generally happens is you lose interest in that thing and keep more money in your pocket to invest (yay! 🚀). It may feel necessary to buy stuff to keep up with friends now, but in the long run, you'll have more freedom and choices sooner than you think if you stay disciplined and consistent. Enjoy the ride! 🐝

Seek opportunities to make calculated, asymmetric bets. Multiply upside potential while minimizing downside risk. Rather than relying on speculation, focus on probabilistic thinking to systematically evaluate and pursue high-conviction ideas with capped losses. Whether in business, investing, or personal growth, progress compounds through a portfolio of rational, asymmetric payoffs over time.

🌟 Wisdom of 'One Up On Wall Street' by Peter Lynch, a titan in the realm of investing. This book is a treasure of insights from one of the most successful fund managers of all time. He champions the idea that average investors can achieve superior returns by leveraging their everyday experiences: 🤔 1. Invest in What You Know: "The best stock to buy may be the one you already own." Lynch encourages investing in familiar industries or companies. 🚫2. Ignore Market Predictions: "If you spend more than 13 minutes analyzing economic and market forecasts, you've wasted 10 minutes." Focus on company performance, not market speculation. 💡 3. Understand the Business: "Never invest in any idea you can't illustrate with a crayon." Invest in simple, understandable businesses. 🌱 4. Look for Growth Opportunities: Investing in 'boring' companies for consistent performance. 🔥 5. Avoid Hot Stocks in Hot Industries: He warns against the allure of 'the next big thing'. ⏳ 6. Be Patient: "The stock market is a device for transferring money from the impatient to the patient." Emphasizes patience in investing. 🔢 7. Diversify, but Not Excessively: Warns against 'diworsification' – owning too many stocks and diluting potential returns. 💲 8. Pay Attention to Valuation: Buy good companies at a reasonable price. 🚨 9. Be Wary of Excessive Debt: High debt can limit growth and increase risk. 👌 10. Keep It Simple: Stick to understandable investment strategies 📈 11. Invest for the Long Term: Lynch believes in holding stocks for several years. 🛑 12. Know When to Sell: Sell if the company's fundamentals deteriorate. 🚀 13. Small Companies have Big Potential: Small-cap stocks can offer significant growth opportunities. Hope this makes you a better investor and compounds your returns! #PeterLynch #Investing #OneUpOnWallStreet

The Fed did not increase rates. Is it important? The real question should be how to position financially based on Fed monetary policy. Today, we held an interesting discussion with our portfolio managers - Juan Xavier Sanchez, CFA, and Jose Luis Cova. I will share some highlights, explain how we position investment portfolios, and advise clients.   Our analysis suggests the Fed is looking at core inflation and wage growth as the key metrics for their approach to rate increases and liquidity in the economy. Why? Core inflation includes shelter (real estate), medical expenses, and transportation, which tend to be ‘sticky’ in nature, meaning they take longer to change. Food and energy are excluded because of their volatility and cyclical nature. Wage growth spiked during the last two years, fueled by low unemployment. A strong labor market is a good sign of a healthy economy, but too much growth can cause higher inflation. According to the Federal Reserve Bank of Atlanta survey, wage growth spiked in the summer last year by about 6.7% and decreased to about 5.3% this summer. How are we positioning investment portfolios? In equities, we favor companies with strong balance sheets and cash flows that help them avoid financing at high rates. In terms of fixed income, keep a relatively short duration. We are not going long because the market isn’t compensating enough for the risk; interest rate and credit risk are involved. Alternatives have been a key focus for our portfolios. We have been finding great opportunities in the private credit space, including loans to corporations and real estate. The yields are attractive, and the volatility is much lower than in public markets. How are we advising regarding family finances? With high rates, it makes sense to be a lender, not a borrower. It used to be the other way around for many years. It might sound simple; the problem is that these changes take time, and personal issues are involved. For example, families looking to buy a home with a mortgage today must spend much more. Today, it seems better to put more money down and less debt than a few years ago.   Some families had a line of credit against their investment portfolio and could get a loan for less than 2% a few years ago. The problem is that these loans have variable rates, and today, they cost about 5% more because of Fed hikes. Does it make sense to hold fixed-income securities that yield lower than the line of credit? Even equities, is the expected return worth it once you adjust for risk? In closing, the evolving monetary policy landscape requires a proactive approach to both investment and personal financial planning. We're in an era of transition, with the Fed's actions permeating multiple facets of the financial world. While rate hikes can be a tool to curb inflation, they also underscore the significance of adapting one's financial strategies in line with the broader economic climate.