Comment by renewiltord | Hacker News Reader

Comment by renewiltord | Hacker News Reader

I wish I, just a guy, could invest in companies like this with no vote stake. I believe in the company and the leadership and I'd like a stake in it and to provide money but I know that if I have the ability to put money in so will all the guys who want an opinion.

It reminds me of Kickstarter. I really enjoyed it because I spend $100 now and then for someone to take a shot at building something. If they fail, so be it. If I get scammed, so be it. I explicitly don't want refunds so that the guys can take a risk. But then other people get involved and they have these high expectations and it ruins everything because then I can't get to the guys who are doing risky things. The way I do it is I fire the money into the ether and then months maybe years later I get an email saying "Sorry, we couldn't do it" or "Where do you want us to ship to?"

i.e. I want an escape hatch for investing and for consumer purchases as well. If the government would let me take a cheap online exam that allows me to exempt myself, I'd love that.

As an accredited investor you can potentially get in on private fundraising rounds.

But most private equity would rather work with a few high value investors instead of many small value investors. It's just so much simpler.

Opening the flood gates to any old Joe Schmoe would run afoul of many SEC rules -- and for good reason. Private equity is enormously more risky and more opaque than public market investing, and could so very easily be abused and fraudulent.

https://www.investopedia.com/articles/investing/092815/how-b...

I am an accredited investor. It's the SEC rules that bother me. There are companies that have taken a lot of investors on but it's usually fairly onerous: https://safegraph.com/blog/safegraph-raises-16-million-serie...

Same here, but here's the deal. A lot of these companies are looking for direction, are looking for leadership. Every unicorn I've worked for already had enough financiers behind the scenes. Sure, many of them risked impossible amounts like 10 million to seed the business. Who are you? What do you have to offer?

They get a bad rap but I hold an opposite view. I'd like to know what companies I can hold an activist position in. Surely, there are businesses around town that would take a 200k check for x-percentage.

I can accept it if they don't want me. I can also accept me not wanting them. What I don't like so much is that we want each other but the government makes regulation too painful for us to cross the barrier.

There are a few ways to get involved in private rounds like this...

1/ Someone is allocated a certain amount and they farm it out to their "fund" of friends and family who invest through an LLC or some other method (I have a modest investment in a few bigger companies this way) 2/ You become an accredited investor yourself, which doesn't require a ton of work but does require some proof that you have capital and then network your way into the raise. (https://www.investopedia.com/articles/investing/092815/how-b...)

I think generally speaking there has to be SOME protections in place or investors who want to get a small piece don't get swindled. This is why public companies have so much compliance, disclosure requirements, etc. associated with them so that the government can step in if they are breaking the law or deceiving investors. Likewise with the increased scrutiny on the company, anyone can open a brokerage account and own stock.

I assume you know some of these things and I also share the pain of "how do I just get in with a small stake on some of these big or small private companies"

Well, there's stock when they IPO.

Beyond that, you may be thinking about becoming an accredited investor, but yeah, there are wealth requirements. https://en.wikipedia.org/wiki/Accredited_investor

Almost none of the companies that IPO in the US today have even the remote possibility of yielding a 20X return, never mind 100X or more. At that stage, you'd usually rather want to go with an index fund.

Most of the allure of early- to mid-stage investments is that a small investment has a small chance of turning into a meaningful stake in a very influential company. So I don't think that the promise of buying a stake in a company that has most of its growth behind it would be very interesting to OP, unfortunately.

This is not true. Even companies whose IPOs are long forgotten can bring 20X returns. In a current stock market frenzy you can have 20X returns in a year. Take Overstock (OSTK). 14X return from the highs of January 2020 or 30X return from the lows of March (COVID sell-off).

Even large caps such as TSLA is almost 10X return in a year(!). It's crazy what's going on with the stock prices right now.

Are you looking for crowdsourced equity like https://wefunder.com ? You will only find small startups though.

We are far too stupid to not fall for scams. It's better that the government "protects" us. /s

Seriously though, this is messed up. Crypto is similar - CoinMarketCap has a program where you can earn tokens by watching a few videos, but look at the list of restricted countries: "Belarus, Democratic Republic of Congo, Cuba, Iraq, Iran, Mainland China, North Korea, Sudan, Syria, United States of America and its territories (American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands), Zimbabwe."

Why the f are we on a list with Cuba, Iraq, Iran, China, North Korea, and Syria??? America is not free

> I wish I, just a guy, could invest in companies like this with no vote stake.

How is this different from just buying stock?

Or are you referring to companies specifically that aren't public?

It's not public, and no companies issue non-voting shares. It's not even clear they would be allowed by the SEC.

Google (Alphabet) has two different stocks you can buy, one of which doesn’t have voting rights. https://www.investopedia.com/ask/answers/052615/whats-differ...

Oh, that's a good point, I forgot about those... despite owning quite a few non-voting shares of GOOG.

Yeah, no, it's not. There's just a regulatory barrier that makes it hard for most organizations to release stock like this to the public. I want to lower that barrier for myself because I am willing to accept a higher scam rate.

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