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Ron Conway - Startup Investor School Day 4
12 segments available
Startup Investor School is a free, 4-day course designed to educate early stage investors interested in investing in startups. We'll cover the fundamentals of investing, from investing instruments to legal and accounting basics to evaluating startups and managing deal flow. Our hope is that more people, from a wide range of backgrounds will consider investing in startups and that those who do will be better at it. Learn more at https://investor.startupschool.org/
Segments Timeline
The Essence of Good Investing
Ron Conway reflects on the qualities that define a good investor, referencing Paul Graham's essay that highlights his own journey as a guinea pig in the startup investment world. He emphasizes the importance of learning from resources and the value of mentorship in angel investing.
"that was a I think a fantastic survey a summary of how to think about what it means to be a good investor Paul Graham actually wrote an entire essay about what it means to be a good investor with Ron ..."
Ron Conway's Journey into Angel Investing
Ron Conway shares his background and how he transitioned into angel investing after founding Altos Computer. He discusses the influence of Don Valentine from Sequoia Capital and how mentoring founders became a passion that led him to invest full-time in 1994.
"teach yourself yeah so Ron by the way since I've had a quote from everybody I have a quote from Ron - Ron said referring to entrepreneurs you can't learn to be ambitious and driven and I think that's ..."
Identifying Disruptive Industries
Conway explains his strategy for investing in disruptive industries, particularly focusing on internet software in the early 90s. He discusses the growth potential of the internet and how he and Ben Rosen sought out the most promising sectors for investment.
"how you got into that sure I'm honored to be here I'm a born in San Francisco raised my kids in Atherton then moved back to San Francisco but my first job was at national semiconductor and a few folks..."
The Importance of Founders
Ron emphasizes that the character of the founder is paramount in investment decisions. He shares insights on how he evaluates founders, highlighting the significance of determination and passion over the business idea itself.
"in 1994 that was two years before Netscape was even founded and you see how huge the internet software industry is today what what insight led you to that I mean there's you know everyone wasn't inves..."
Lessons from Investment Failures
Conway discusses the reality of investment failures in angel investing, noting that 40-60% of investments may fail. He stresses that failure is part of the learning process and that new investors should not be discouraged by it.
"of started started the trend and an anti-spam company called bright mail remember well what what was it about Ask Jeeves and PayPal that convinced you to write a check all the four four SV angel it's ..."
Evaluating Co-Founder Dynamics
Ron shares insights on the importance of co-founder relationships and how conflicts can lead to business failures. He explains how to assess co-founder compatibility during the investment evaluation process.
"second so I sort of had a question you know you put a lot of thought into into what you like in founders and I know I know you guys have a whole whole whole thing on that back then you have to meet fo..."
Adding Value Post-Investment
Conway outlines the key ways he adds value to portfolio companies after investment, including helping them build management teams and facilitating partnerships. He emphasizes the importance of decisiveness in startup leadership.
"and goal driven I think a Mark Zuckerberg and then you meant suck Waverly we met suck when he was 19 years old the summer he came out here that he was supposed to go back to Harvard and never went bac..."
Advice for New Investors
Ron shares practical advice for new investors, advocating for a portfolio approach to investing. He suggests investing in multiple companies within a sector to mitigate risks and increase the chances of success.
"you know lots of Angels after their first company goes out of business they drop out and I'm like what are you talking about failure failure is part of the experience you have to often than not just s..."
The Role of Metrics in Investing
Conway reflects on how he measures success in angel investing, noting that wins are the ultimate metric. He discusses the importance of focusing on adding value to founders rather than solely chasing financial returns.
"and that is very very hard to predict but we do look for that now that oh these founders don't get along you know we don't want to be the divorce lawyer again how can you tell we're in the company we ..."
Civic Engagement and Investing
Ron emphasizes the importance of civic engagement for investors and founders alike. He draws inspiration from youth movements and encourages investors to support socially responsible initiatives.
"addition to general mentoring initially it's introducing them to other members of the team once the company starts to take off they've got to hire engineers marketeer sales people and helping them bui..."
Final Thoughts on Angel Investing
Conway concludes with a call to action for investors to maintain integrity and transparency in the startup ecosystem. He stresses the importance of collaboration to improve the investment landscape.
"getting this right is really important I remember I was actually doing this kind of talk with Ron once and someone asked a question and you know Rhonda mirrored a little bit so I was sort of saying wh..."
Recap and Key Takeaways
The session wraps up with a recap of the key topics covered during the course, including investment strategies, deal flow, and the importance of community engagement. Ron encourages ongoing learning and collaboration among investors.
"because you're probably not going to spend that much time with it how did you get involved with YC funny enough Chris Sacca introduced me to Y Combinator and it took some convincing because I said oh ..."