Loonastatic | 5 Things Chris Sacca Advises New Startup Investors | Christopher Sacca is a well-known name in the American business world as a venture capitalist, business counselor, entrepreneur, and lawyer. His investments in seed and early-stage technology companies such as Twitter, Uber, Instagram, Twilio, and Kickstarter led to his placement as No. 2 on Forbes’ Midas List: Top Tech Investors for 2017. He is the proprietor of Lowercase Capital, a venture capital fund in the United States. Lowercase Capital has made investments in companies such as Twitter, Uber, Instagram, Twilio, and Kickstarter. Sacca worked for Google Inc. in a variety of capacities, including as the head of the alternate access and wireless divisions, as well as in the mergers and acquisitions department. Between the years 2015 and 2017, he made multiple appearances on the ABC show Shark Tank in the role of “Guest Shark.” At the beginning of 2017, Sacca made the announcement that he would be retiring from venture investing. However, he also stated that he would be making a comeback with an $800 million fund that he raised for Lower Carbon, a venture company focused on climate-tech.
As of the 15th of July in the year 2020, Chris Sacca has a net worth of one billion dollars, as reported by Forbes.
Let’s find out his style and lessons on being an investor. Let’s go!
#1 Be able to say “No!”
Chris Sacca previously said that when it comes to investing in companies, one’s Default response should be no, and it’s important to learn how to say no. He is of the opinion that a common mistake that many people make is seizing opportunities that later prove to be disastrous. As a result of his experiences investing in new businesses and enterprises, he advises potential investors to conduct adequate research before making any investments. Take a look at the Market, and allot some time for yourself to carefully go over all the relevant information. If you want to go where you’re going, you can’t accept every chance that comes your way. First, you should do some research, then you should look for something extra-ordinary, and finally you should invest.
#2 Go all in
In a blog post that was published on the website of Sacca’s organization in 2017, Sacca revealed to readers that he would no longer be active in the field of startup financing. He stated that it had been a challenging decision to come to that conclusion.
He stated, “It’s hard to leave all of this behind right when things are going so well,” which is a very true statement. He stated that he is good at what he does and is still developing as he learns from mentors, founders, partners, friends, family, strangers, my own investors, and the experience itself. He said that he is good at what he does and is still improving.
Sacca revealed that he was experiencing frustration as a result of his divided focus, which prompted him to make some difficult decisions. He revealed to Forbes that he has been attempting to engage in investing on a part-time basis for the past few years.
Then, he came to the conclusion that his approach to investing in new businesses would not be successful if he did not devote all of his time and energy to any given enterprise. The only way that he could see of being exceptional at what he can do for startups was to be intensely focused on the task at hand and to go through all of the challenges alongside the entrepreneurs. He came to the realization that anything less than a full dedication left him feeling irritated and ineffectual, and he attributed those feelings to himself.
You may remember him saying on Shark Tank that he will not invest any more money unless he is willing to go “all in.”
#3 Be able to create better value
You should only put money into the business if you are confident that you can help it in some way. When Matt Mazzeo, Sacca’s partner at Lowercase Capital, and Sacca make the decision to invest their money in a company, they are also making the commitment to serve the company’s founders in the capacity of advisors. According to Sacca, in order for him to make this commitment, he does not need to believe that he will be able to see a business through to its initial public offering in order for him to be able to do so (IPO). However, in order to raise the likelihood that something will be successful, he does need to know that he will be able to “make a meaningful impact.”
Invest your money in a company that has proven to be successful in the past. Everyone who has a steady job is obligated to contribute to the successful completion of projects that have been assigned to them, regardless of whether or not they like to do so. This is the case even if they have no interest in doing so. According to Sacca, inexperienced investors commonly get to the point where they are so used to having this mindset that they leave themselves too open to possibilities for acquisitions.
“Your go-to response should be ‘No,’ since the vast majority of transactions are horrible,” he advises those who are just starting out in the world of investment, saying that this is sound advice. ” The vast majority of business transactions and companies will end up losing money.
Invest your money in a firm that has previously proved effective operations but still has opportunity for improvement. This will provide you the best return on your investment.
#4 Get wealthy with honor
Even the most prosperous new businesses will need a large amount of work to get off the ground, and only a very small percentage of new enterprises will wind up being “unicorns” like Twitter or Uber. The operation of a firm always goes like this. Sacca came to the conclusion that it is necessary to design a portfolio that allows for the prospect of earning money from both extremely successful endeavors and somewhat successful endeavors. This can be accomplished by not dissipating one’s resources too thinly, joining the market at a price that is low enough, and making investments with a mind toward the long term.
Have some pride in good deals. According to Sacca, one of the reasons he has been so successful in business is because he refuses to do transactions that require him to violate his principles or values. He says, “There are things that I’ve turned down, but I just don’t regret it at all.” “There are things that I’ve turned down.” “There are some things that I have not kept,” Sacca said.
Products that are developed on the basis of unverifiable promises, advertising agencies that post deceptive advertisements on domains that have been misspelled, subscription services that make it purposely difficult to cancel, and social networks that use anonymous material are some examples.
Sacca is quoted as saying, “It seemed like a good way to generate money, but I don’t have to explain to my kids that that’s how I’ve made money.”
#5 Find the best storytellers
Good storytelling beats good spreadsheets. Sacca tells investors to spot founders who work on their storytelling and expression.
Sacca is a firm believer that the “why” you are doing something is more important than how you are doing it or what you are doing. Stories sell, spreadsheets don’t. A good spreadsheet may land you a job, but a good story could help direct you to an angel investor for your business.
He wants investors to look at founders who strive to be the best storyteller. They should keep a clear vision in their mind, let investors know what they think, and always know their figures. They must also be aware of and take note of competitors. Sacca, who has one of the best tech portfolios, usually emphasizes that the major focus should be on selling yourself, not your product.
Sacca is a firm believer that one should strive to provide value in all aspects of life. Even while the majority of his feedback does come from those who demonstrate devotion and genuine thankfulness, he does not rely on validation from other sources. Instead, Sacca has gained more confidence as a result of internalizing affirmation, which has enabled him to speak more openly about the things in which he genuinely believes.
Following his decision to stop investing in other businesses, he has moved his attention to charitable organizations that are combating environmental concerns that pose a threat to the human race.
After leaving his job at Google, one of the largest technology companies in the world, Sacca believed in himself while paving his own way to become one of the most successful self-made billionaires. If that isn’t inspirational, I don’t know what is. There are a lot of things you can learn from him, and one that stands out the most for me is his main principle: “Believe in yourself even if nobody else does.”