Businessman Warren Buffett Widely regarded as one of the greatest investors in the modern world. His seemingly unmatched and consistent value investing strategy earned him the title of Oracle of Omaha.
Many of his investment strategies are well known, but there is one that is often overlooked but very important. In the world of startup investing, it’s more common. One customer can mean all the difference for a startup, but not necessarily for a public company.
What’s wrong: Buffett is one of the world’s greatest investors, so there are many lessons to be learned. He loves Coke and he decided to invest in Coca-Cola a long time ago. Coca-Cola Company It ended up being one of his best investments to date.now he is getting Apple. Recently, I switched from Garake to iPhone.
So what kind of strategy is this and how does it relate to Buffett’s love of Coca-Cola? Value-added investmentand the general idea behind it is that you should invest in startups that you use, are customers and can add value to the company.
For Buffett, one of the longest held positions is Coca-Cola, which he has owned for over 34 years. He has publicly endorsed the company and is said to drink five cans of Coke a day.
To get the latest on top startup investments, visit Sign up for Benzinga’s Startup Investing & Equity Crowdfunding newsletter
Buffett’s company Berkshire Hathaway began buying shares in Apple in 2016 and is now the company’s second largest shareholder, owning more than 5% of the tech giant. In late 2020, Buffett ditched his $20 flip phone for his iPhone, and now he also has an iPad. The idea was probably not the need for a new phone, but rather a statement to support Berkshire Hathaway’s biggest investment.
This way of thinking can be an effective way to invest. On the public market, investing in the company you’re using is likely to pay off more because if you like the company, others are likely to too. A good purchase probably won’t move the needle.
At a startup, it’s not. Startups often rely on venture capital (VC) or other funding to keep the company alive until it turns a profit. Because the brand is not established, the first customers can be expensive and people will be hesitant to spend money. means the difference between
Buying a product from a startup for a few hundred dollars on a regular basis and recommending it to a few friends and family can generate thousands of dollars in profit because marketing costs nothing. That could be the difference between raising additional capital, paying rent for the month, or carrying forward profits to get a few more customers. They are likely to like it, and this can strengthen your startup investment theory.
A few years ago, ordinary investors couldn’t invest in startups, but not now.Now anyone can access sites like turn on the engine We invest in top startups, including StartEngine itself. StartEngine makes money when you invest in your site. So if you invested in StartEngine and continued to invest in other startups on the site, you are effectively using the same principles as Buffett by using your investment to support it. Supporting investment in these startups helps them and you share in the profits.
Buffett isn’t the only investor taking this approach. It is popular among startup investors and there are whole companies devoted to this kind of investment. Many VCs have had great success reaching out to companies that have found new products they want to invest in.
Some can apply this to startups that sell to other businesses, but most investors focus on consumer-focused companies like Apple and Coke.
max tracker It’s another startup that we’re raising with StartEngine. It makes money by selling GPS trackers used via mobile phone apps. It helps keep your kids, cars, bikes, and other belongings safe, and every purchase you make helps keep your startup on track. A billion-dollar company can be very lucrative.
All of these investments are speculative and illiquid, so it is important not to invest more than you can afford to lose. Still, investing in startups can be a great way to diversify your portfolio or simply invest in a company you like.
Read more about Benzinga’s startup investments.
Don’t miss real-time stock alerts – join Benzinga Pro for free! Explore tools that help you make smarter, faster and better investments.
© 2022 Benzinga.com. Benzinga does not provide investment advice. all rights reserved.