Things to Consider When Investing in a Startup

Investing in a Startup pic
Investing in a Startup
Image: bankrate.com

With an impressive track record of business leadership and venture investing, Bill Malloy serves as a founding general partner and investor at Sway Ventures in San Francisco, California. In this capacity, Bill Malloy oversees the company’s investments in early-stage & early-growth software companies.

When investing in a business startup, investors should consider several factors, including why they have the opportunity to invest in the startup. Most new companies seek investments simply to raise money. This is not automatically a red flag, but investors should consider that the lack of financing may suggest business struggles.

Further, investors must be aware that many startup investments do not have returns for at least a couple of years. Startups need to funnel any earned money back into the company, so returns may not appear until the business is established.

Investors can reduce risk by investing in markets they know. By investing in familiar markets, investors can better understand a company’s structure and get a more accurate idea of the business’ potential.

However, diversifying is still wise. Multiple investments increase the chance that investors will receive returns on their money.

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Author: billmalloyblog

Bill Malloy is an innovative financier and technologist with a record of successfully investing in inefficient markets. Bill is a founding General Partner at Sway Ventures, where he is focused on IT software investing, hands-on operational support, and building the strategic ecosystem between the US and EMEA. His responsibilities focused on strategy and go-to-market plans for new product development. He currently holds board positions in a number of portfolio companies including Penrose, LE TOTE, HyTrust, LiveAction, Zanbato, and Addepar. Bill gained his venture capital experience at DFJ – Zone Ventures by working with companies on elements of strategy, operational issues and financial structuring. He also devoted significant time to potential new investments between Silicon Valley and Southern California. His background in business development and product management includes five years of service to Listen.com (sold to Real Networks, a $1.3 billion company) and MusicMatch (sold to Yahoo, a $38 billion company). Bill balances a number of philanthropic positions, currently serving as trustee of the Malloy Foundation as well as Co-Founder of the PEERS Network. He previously served as a board member and treasurer for the Equinox Center. He holds a MBA from the University of Southern California and an undergraduate degree in Engineering from Clemson University.

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