How many startups should you invest in?
Early-stage investing has a reputation for being highly risky, and for good reason: the majority of startups fail in their first five years. But industry data shows that investing in startups can also be highly profitable – if you’re smart about it.
According to The Alternative Investment
Report by NESTA and Intelligent Partnership, an early-stage portfolio should contain at least 28 investments in order to have a 95% chance of securing at least one 10x investment. But that’s not all you can do to maximise your chances of bagging a successful exit. THE ONLY FREE LUNCH IN FINANCE
A broad portfolio of investments spanning different stages, levels of liquidity, sectors, sizes and types has a reduced chance of containing highly correlated investments, where macro factors such as housing market changes, unemployment or general market performance can affect all investments in one fell swoop.
By building a portfolio of uncorrelated investments across multiple sectors, you reduce your chances of a single sector experiencing a negative change and it bringing down your entire portfolio; think, for example, of how a shift in oil prices can affect a vast number of investments within that sector. We combined this diversification principle with NESTA’s magic number to bring you a brand new kind of investment fund.
Fund Twenty8® is the first and only fund to automatically build you a diversified portfolio of at least 28 EIS-eligible early-stage investments, across a broad range of sectors, targeting a return of over 20% IRR including up to 30% EIS tax relief.
• 28+ EIS-eligible investments per fund
• Up to 30% EIS tax relief
• Unparalleled cross-sector diversification
• Targeted IRR of 20%+
Nested within SyndicateRoom, the UK’s premier equity investment platform, Fund Twenty8®’s algorithmic approach draws on data from the investment decisions of thousands of sophisticated and highnet-worth investors to determine which companies to back. The fund has raised a total of £7.9m from 377 investors to date.
Last year’s Fund Twenty8® built a portfolio of 32 EIS investments spanning 10 sectors.
Fund Twenty8® will open for 2 weeks on Tuesday 11th September 2018. Get the ultimate in startup diversification: www.syndicateroom.com/fund-twenty8