Startup Funding Espresso – The Benefit of Short-Term Returns

The Benefit of Short-Term Returns

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In startup investing, many investors swing for the fences.

The goal is to make each investment a homerun.

In most cases, home runs will take a substantial amount of time to complete.

There are benefits to short-term investments in which the returns are smaller.

Here are some benefits to consider:

There’s a psychological boost that comes from knowing you’ve had a return of capital.

The returned cash can be recycled into a follow-on investment in a home run deal.

Short-term returns are easier to fund.

Home run deals are often difficult to get into due to investor demand.

Short-term returns are easier to find.

There are many startups that can return capital in three years or less.

This can boost one’s investment metric, such as an IRR, which includes time to return as part of the calculation.

Consider both short and long-term return startups for your investment strategy.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

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