How risky are these investments?
But I believe if you do your homework, invest alongside top-tier investors and build a diverse portfolio of 15 to 20 (ideally more) high-quality companies, you’ve got an excellent chance of making money. And if you happen to hit a “unicorn” (a company with a $1 billion or more valuation), that’s going to move the needle no matter how big your portfolio is.
It’s kind of like picking stocks. Don’t fall in love, especially with an idea. It takes a lot more than a good idea to grow a company from $5 million to $1 billion.
Bottom line with early-stage stuff: Don’t invest money you can’t afford to lose. Start off slow, no matter how promising an opportunity seems at the time. There will always be others.
Pre-IPO companies are certainly safer. Most pre-IPO companies today would have been public 15 or 20 years ago.