Category Archives: Business

AMC’s 9 Million Missing Shares

Trading in shares of AMC Entertainment Holdings Inc. just gets stranger and stranger.

A new report from the SEC shows fails to deliver dropped to 205,675 shares in the first half of July, the latest reporting period. This is down from a high of nearly 9.7 million just two weeks ago.


Get the blog before anyone else…subscribe!


So, were exchanges busy little bees cleaning up over 9 million shares worth of failed trades?

Maybe. Or maybe those shares went somewhere else…

The Depository Trust & Clearing Corporation (DTCC) settles most US securities transactions. It has an “obligation warehouse” where it puts failed trades.

Once those failed trades go to the obligation warehouse, they basically cease to exist.

We don’t know for sure if that’s what happened with these 9 million shares because the SEC and DTCC won’t tell us. But given the complexity of settling that many failed trades, I’m willing to bet the DTCC just wiped the slate clean.

So why does this matter?

Allowing huge numbers of trades to fail enables naked short selling. Naked short selling is selling short shares without borrowing them first.

It’s a powerful way to push down a stock’s price. After all, if you don’t have to find shares to borrow, you can short as many shares as you want!

No wonder Compliance Week calls it “one massive embezzlement scheme that for years has mostly gone ignored.”

Why would the DTCC do this? Perhaps because of how it’s funded.

The DTCC makes money by clearing trades and is owned by its users.

Hedge funds are some of its heaviest users.

No wonder the DTCC just sweeps trades under the rug instead of investigating what happened.

The SEC should investigate the pattern of massive fails to deliver in stocks like AMC. And the DTCC must ensure trades are actually completed.

Until then, we’ll continue to see these shenanigans in markets.

What do you think happened to these 9 million shares? Leave a comment at the bottom and let me know!

More on markets:

AMC Fails to Deliver Hit 9.7 Million

How DTCC Makes Fails to Deliver Disappear

Wall Street Banks Turn on Each Other as Federal Probe Looms

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Sequoia Comes to the Big Apple

Exciting news out this week as legendary venture firm Sequoia Capital comes to NYC. Its new offices near Union Square are the firm’s first American branch outside the Bay Area.


Get the blog before anyone else…subscribe!


From The Information:

Sequoia Capital, the Menlo Park, Calif.–based venture capital firm known for its early investments in Google and Instagram, plans to open an office in New York City, its first U.S. facility outside Silicon Valley, according to two people with direct knowledge of the matter.

The move by Sequoia, the most prominent tech startup investor, underscores a broader shift by venture capitalists to plant roots outside the San Francisco Bay Area following the pandemic-fueled boom in remote work, which spurred more founders to start companies in other regions and cities, including New York


I actually heard about this through the grapevine several months ago, but now it’s official! The firm will take offices in a beautiful new glass high rise on East 14th Street.

I happen to know the area well. Next door is the only Trader Joe’s in the city with a wine shop.

Perhaps Senior Steward Roelof Botha will pop in for some $4 red?

The arrival of the greatest firm in the history of venture capital is a landmark moment for New York. Venture funding in the city has jumped over 250% in the last 2 years.

I’m seeing more and more awesome startups here. Two of my last three investments have been NYC-based companies.

Remote work is fueling the New York tech scene. Founders who had to be in the Bay Area in the past are now free to live where they like.

The accelerators that birth so many startups, like Y Combinator and the LAUNCH Accelerator, are all online now. And VC’s are comfortable investing over Zoom.

So, many founders are abandoning the Bay and coming to NYC. It’s denser than San Francisco with more to do, safer and (a little) cheaper.

Entrepreneurs used to go where the VC’s were. Now investors are following founders.

Andreessen Horowitz is also opening an office in New York, along with LA and Miami. Soon, I expect every major US venture firm will have a presence in NYC.

If density of capable people and chance meetings fuel the startup world, New York seems like a natural choice.

It’s denser than anywhere in America, by far.

I can walk between offices of numerous venture firms and startups in just a few minutes. At NYC tech events, I randomly bump into the same people almost every time.

It never made sense for an industry predicated on instant worldwide communications to cluster all in one place. I’m delighted to see this dynamism that began in California spread nationwide.

Welcome, Sequoia! And here’s a tip: head across the river to Hudson County, NJ.

It’s just better. 🙂

What do you think of New York’s tech scene? Leave a commnet at the bottom and let me know!

There will be no blog on Monday. I’ll be in the woods celebrating a friend’s birthday!

See you on Tuesday. Have a great weekend everyone! 👋

More on tech:

Crypto VC’s to Crash: “YOLO”

Why Technical Founders Win

Inside the Seed Funding Slowdown

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: Roelof Botha “509307017DH00078_TechCrunch” by TechCrunch is licensed under CC BY 2.0.

Chinese Stop Paying Mortgages as Real Estate Crisis Spreads

Chinese homebuyers are refusing to pay their mortgages in a boycott that’s spreading across the country. Many fear the homes they’re paying for will never be finished.

Now, suppliers to builders are also defaulting on loans.


Get the blog before anyone else…subscribe!


From ABC News Australia:

A fast-growing mortgage boycott across dozens of cities in China has prompted some property suppliers to cease their bank loan repayments, raising fears the escalating situation could trigger a further downward spiral in the sector and even threaten the country’s financial stability. 

Hundreds of landscapers, sculpture-makers and construction companies have expressed their anger that they have been bled dry because some debt-saddled developers did not pay their bills while they continued to service or help build apartments, Chinese media Caixin reported.


Chinese usually buy homes and start making payments before they’re complete.

The boycott has spread to 90 cities in mere weeks.

The Chinese government is censoring reports on the boycott, per Bloomberg. So the situation inside China may be even worse than reported.

A real estate meltdown is a catastrophe for the average Chinese saver. Chinese put 70% of their wealth in real estate, compared to 35% in the US.

The property sector accounts for about 25% of GDP. China’s GDP growth has flatlined as the sector sputters.

And it gets worse. Chinese banks have lent huge sums to property developers.

As developers default, bank runs are spreading across China. Government thugs have beaten protesters desperately trying to recover their life’s savings.

Amid a bleak economy and constant COVID lockdowns, workers are struggling. Youth unemployment has spiked, hitting over 19% last month.

Consider the picture for the average Chinese person: most of your savings are tied up in an apartment that will never be completed, the rest is in a bank that’s insolvent, and your only child can’t find work.

Revolution might start to sound good.

In the US, we know that a property crisis fueled by heavy debt can spread quickly. Huge liabilities pop up at different institutions unpredictably.

This undermines confidence in the entire financial system. When that happens, you get a financial crisis.

That’s what China is facing today.

At stake is the legitimacy of the Chinese Communist Party. Officials have staked their power on offering ever-increasing living standards.

Those days may be over.

I can only hope that Chinese citizens prevail and oust a government that has brutalized them for generations.

More on China:

Mass Protests in China as Bank Runs Continue

Will Evergrande Spark a Global Financial Crisis?

China Is Killing its Tech Industry

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: Unfinished Chinese apartment buildings being demolished in Kunming, China

Crypto VC’s to Crash: “YOLO”

Despite cratering crypto markets and a slowdown in venture funding, crypto VC’s are upping the ante. From a report out yesterday in Reuters:

Even as the crypto sector shivers in the bleak winter, venture capitalists are pouring money into digital currency and blockchain startups at a pace that’s set to outstrip last year’s record.

In the first half of the year, VCs bet $17.5 billion on such firms, according to data from PitchBook. That puts investment on course to top the record $26.9 billion raised last year, a warmer and happier time for bitcoin and co.


Get the blog before anyone else…subscribe!


Overall US venture funding fell in the first half of the year. But US crypto investments are on pace to increase almost 50% over 2021.

Why are crypto VC’s behaving so differently? Because they don’t have much choice.

Numerous venture firms recently raised huge crypto funds. Predictably, Andreessen Horowitz is at the front of the conga line, raking in $4.5 billion in May.

Electric Capital pulled in $1 billion, and Bain Capital launched a $560 million fund.

All that money has to go somewhere. But deploying giant crypto funds today could be a big mistake.

Giant funds have to focus on late stage deals. After all, there’s no way a16z is going to hand out 1,000 seed-stage checks of $4.5 million.

It’s simply more meetings, diligence, and oversight than any firm could handle.

So they’ll put a lot of that in late stage megarounds. Since the startups are close to going public, their valuations depend on public markets.

But markets in public tech stocks and crypto tokens are extremely unpredictable right now.

These firms may pay prices that public markets soon find laughable.

If that weren’t bad enough, the SEC could soon be breathing down the necks of VC firms.

Yesterday, the SEC announced that it’s investigating Coinbase for offering unregistered securities. Crypto VC’s have likely sold similar securities.

The crypto venture market looks seriously overheated. I see companies with no product or customers getting valuations of $100 million or more regularly.

You don’t often see that in non-crypto deals. And there’s no reason why the rules should be any different for crypto.

I think crypto could have some awesome applications. Cheap international money transfer may be the best use case.

But thus far, speculation has been rife and useful projects few.

Meanwhile, I’m going to keep investing in great early stage companies with awesome products and happy customers. And if a crypto company can deliver that, a salute!

More on tech:

Inside the Seed Funding Slowdown

Why Technical Founders Win

The Top 5 Things I’ve Learned from Angel Investing

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.

Why Technical Founders Win

You have an amazing idea. But can you make it a reality?

That’s the question facing a lot of non-technical startup founders. 


Get the blog before anyone else…subscribe!


I often meet with entrepreneurs with amazing ideas. They want to raise capital to build their product.

But this isn’t how venture capital works.

A technical team can get to first base before a nontechnical team leaves the dugout. 

Investors rarely if ever want to give you money to create a product. They want to give you money to scale up an existing product that has some early traction.

That money could let you hire more engineers and salespeople. The additional staff could let you add features and find more customers.

But how are you supposed to get the product built in the first place? That’s why being a technical founder is so important.

An entrepreneur with coding skills can build it herself! 

Many great founders create a product in their spare time. As it gains momentum after launch, they can quit their job and focus on it 100%.

As they start to bring in customers, they’re in a strong position to raise capital. 

The non-technical team can’t build it themselves. They must hire costly engineers or pay a fortune to a development shop.

A technical team can get to first base before a nontechnical team leaves the dugout. 

No wonder Y Combinator Managing Director Michael Seibel looks for teams that are at least 50% technical.

Being able to build in house cheaply or free is especially important when capital is scarce. No one wants to fund a company that burns cash like crazy in today’s market.

What’s more, a technical team can quickly improve their product.

Let’s say the sign-in flow is difficult and users are giving up. If you have to contact a dev shop, who knows how long it will take to get fixed?

But if you know how to fix it yourself, you could have a better product today.

And those dev shops that seem so appealing can screw you over big time. Some refuse to give you the source code or take a huge slice of your company’s equity.

This makes it hard to ever leave the dev shop. That’s no accident. 

What’s more, giving an agency a huge slice of your cap table makes you unfundable by venture capitalists. There’s simply not enough equity left for the founders, employees and investors!

It’s hard to create a software company if you don’t know how to build software. Be sure you have at least one builder on your founding team.

And if you don’t have the skills to build your dream, go get them! 

It’s never been easier to learn to build software. There are numerous online courses available, many of them free.

Even if you never reach the Stanford Comp Sci level, being able to poke around in your product is a huge advantage for any leader! 

So let’s build skills, keep the burn down, and make something awesome!

How do you view technical vs. non-technical founders? Leave a comment at the bottom and let me know!

More on tech:  

INSIDE THE SEED FUNDING SLOWDOWN

THE TOP 5 THINGS I’VE LEARNED FROM ANGEL INVESTING

TWILIGHT OF THE QUICK DELIVERY STARTUPS

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor.

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: Patrick Collison, CEO of Stripe. Collison’s strong technical background gave him an edge. “File:Patrick Collison.jpg” by JD Lasica is licensed under CC BY 2.0.

Former Congressman Arrested for Insider Trading

Former Congressman Stephen Buyer was arrested today for insider trading. From Politico:

Federal authorities filed criminal and civil insider trading charges against former Rep. Stephen Buyer in U.S. court in Manhattan on Monday, alleging that the Indiana Republican used information gleaned from a golf outing with a T-Mobile executive to purchase securities before the company’s planned acquisition of Sprint.

Buyer was arrested on Monday, said U.S. Attorney for the Southern District of New York Damian Williams at a press conference.


Get the blog before anyone else…subscribe!


Buyer also made suspect trades in at least one other company. His trades made him over $300,000.

He may have even used his mistress to hide the trades:

The SEC’s complaint claims that Buyer netted roughly $330,000 from the transactions, which he spread across multiple accounts belonging to associates and family members, as well as an unidentified friend with whom he had allegedly engaged in a romantic relationship.

I was put in mind of a great scene from The Wolf of Wall Street. Leonardo DiCaprio realizes his elegant Swiss banker is telling him to hide his money under someone else’s name:

Politicians trading on inside information is nothing new. Congressional representatives beat the market on average, despite many having no background in investing.

House Speaker Nancy Pelosi has been particularly successful. Her performance is 6th best out of 435 members of Congress.

I guess power has its perks.

The public will not trust markets like this. If the powerful use inside information to get ahead, the average person will conclude the game is rigged and walk away.

This means companies won’t get the capital they need. And savers won’t be able to build wealth.

These crooked politicians also undermine trust in government. If you’re profiting from your office, you’re not doing the people’s business.

High government officials and their families should keep their assets in a blind trust. That way, they have no way of using inside information for profit.

I hope these prosecutions start hitting a much higher level. There’s plenty of opportunity here for an ambitious prosecutor to make his career by taking one of these major pols down.

What do you think of politicians self-dealing? Leave a comment at the bottom and let me know!

More on markets:

Wall Street Banks Turn on Each Other as Federal Probe Looms

AMC Fails to Deliver Hit 9.7 Million

Shorts Having Their Worst Month Since January 2021

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.

Photo: Former Congressman Stephen Buyer

Investors Pull $28 Billion from Hedge Funds

Note: This is not financial advice.

It’s not looking good for hedge funds. Investors pulled nearly $28 billion in the second quarter, disillusioned by poor performance.


Get the blog before anyone else…subscribe!


From a new Reuters report:

Amid high volatile [sic] across markets, investors redeemed $27.5 billion of hedge funds between April and June, bringing total withdraws in the first half of the year to $7.7 billion. No hedge fund category lured fresh money from investors in the second quarter.

Total assets ended the second quarter at $3.8 trillion, down roughly 5% from March, [data provider HFR] said, also battered by the funds performance. The fund weighted composite index is down 5.78% in the year, HFR said.

This has been a long time coming. Hedge funds have consistently underperformed the S&P 500.

From Axios:


Why, in the name of all that is holy, do people leave a dime in these things? You can get a Vanguard S&P 500 index fund for 0.04% a year.

I own a bunch of shares in that fund myself. It beats paying a hedge fund 2% of assets and 20% of gains for rotten performance!

One of the most astute investors in the market, the California Public Employees Retirement System (CalPERS), pulled every cent from hedge funds 8 years ago.

But the pension money of far too many hard working Americans is still in these putrid investments.

If the smartest guy at the table just got up and left, why is anyone sticking around?

Hedge funds have an aura about them. Geniuses in glass towers pulling the strings of markets.

But the emperor has no clothes. And to quote Gordon Gekko:

What do you think of hedge funds? Leave a comment at the bottom and let me know.

Have a great weekend everyone!

More on markets:

Wall Street Banks Turn on Each Other as Federal Probe Looms

AMC Fails to Deliver Hit 9.7 Million

Bill Ackman Loses $4.8 Billion

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “the emperor has no clothes” by nevermindtheend is licensed under CC BY-NC-ND 2.0.

Inside the Seed Funding Slowdown

Every morning for the last couple of months, I see the same thing: fewer deals in my inbox. So it’s no surprise that new data from Pitchbook show a drop in seed funding for the second quarter:


Get the blog before anyone else…subscribe!


From an analysis of the data that just came out in The Wall Street Journal:

Even funding for seed-stage deals, often the first source of outside financing for companies still developing their products, has taken a hit. U.S. deal volume dropped 11% to $3.9 billion in the second quarter compared with the year-earlier period, the first such quarterly drop on a year-over-year basis in almost two years, according to data from PitchBook.

“The seed and Series A funding environment is the toughest I’ve ever seen in my career managing a fund,” said Jeff Morris Jr., who manages a crypto-focused early-stage fund called Chapter One. “It will be painful in the short-term.”

Remember there’s a big lag in this data. Even in the boom times, a round could take 2 or 3 months to close.

Now, I often see deals sitting out there for 4 months or more. So we won’t see the full extent of the slowdown for another quarter at least.

That’s probably why Pitchbook shows an increase in seed valuations. Deals in the market today are priced lower.

I’m seeing around a 30% drop in seed stage valuations. The typical seed round is at $8-12 million post-money.

These valuations are for strong companies with rapid revenue growth. They often have $250,000 or more in annual revenue.

Those companies might have commanded $20 million or more last year.

In this environment, founders are changing their focus. From The Wall Street Journal:

Amid the chilled environment, investors say even the youngest startups are now being expected to demonstrate they have a clear path to generating revenue and profits.

I see portfolio companies of mine retooling to focus on revenue. They know that user growth alone won’t cut it anymore.

They’re also changing their fundraising approach:

Some seed startups are already struggling to raise Series A rounds, an investment stage where investors typically expect businesses to show clear signs of traction among customers. Many of these companies are now raising extension rounds, capital usually offered from existing investors at the same price as the last round, according to Ms. Achadjian and other venture capitalists.

I see some of my companies doing this, even strong ones. But unless there’s a new investor coming in to price the round higher, I usually stand pat.

I want the startup’s progress to be validated in the market before doubling down.

One interesting nugget in the report: NYC is booming. The Bay Area has done 1,692 deals this year to NYC’s 1,156.

The Bay Area’s share of funding remains much higher. But this likely reflects big checks going into late stage companies.

A decade ago, you had to be in the Bay to create a major startup. Today’s late stage companies were founded during that time.

Now, the market is more distributed. I think you’ll see the New York area catch up as our companies mature.

In all, the Pitchbook report is concerning but not disastrous. If you’re focused on signing up customers and making them happy, you’ll do great!

What are you seeing in today’s funding environment? Leave a comment at the bottom and let me know!

More on tech:

The Top 5 Things I’ve Learned from Angel Investing

Twilight of the Quick Delivery Startups

Did LinkedIn Just Build the Future of Work?

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo: “WHOA Stop Sign” by Lynn Friedman is licensed under CC BY-NC-ND 2.0.

Shorts Having Their Worst Month Since January 2021

Note: This is not financial advice.

Short sellers are having their worst month since January 2021. From a new Bloomberg report:

Somehow, the stock market’s worst first half in five decades has morphed into a slaughterhouse for short sellers.

More big lumps were felt Tuesday, when the S&P 500 rallied 2.8% and bearish traders suffered losses roughly double that.

About 98% of S&P 500 members advanced, the broadest rally since December 2018. The most-hated stocks jumped 5.5%, eventually delivering pain for bears who were forced to cover their positions to limit losses, going by a Goldman Sachs Group Inc. basket. With the most-shorted basket up 16% in July, the month is shaping up to be the worst for short sellers since the retail-driven squeeze in January 2021.


Get the blog before anyone else…subscribe!


Heavily shorted stocks have not run like this since meme stocks skyrocketed last January. Indeed, meme stocks are causing some of the biggest pain for shorts right now.

This tussle between the two sides of the investment world has continued this year, and fresh data from S3 Partners, LLC shows that between January and July 2022, AMC short sellers lost more than $1 billion in mark to market losses.

We’re in a bear market. This is not a great time to bet that stocks will go lower.

But hedge funds have piled in anyhow, betting against volatile stocks with cult followings. And again, they’ve taken major losses.

Perhaps some in the hedge fund world are beginning to learn their lesson. I had dinner with a bunch of hedge fund guys last month, and one said:

“Short selling is a great way to lose money.”

Now, short selling hedge funds may be forced to buy stock. They cannot fall too far behind their benchmarks.

Again from Bloomberg:

“Positioning had gotten very defensive as managers were anticipating additional downside. However, if the market rallies, then they are at risk of underperforming the broader market,” Freeman said. “Shorts are hurting their performance and they don’t have enough long exposure to keep up so they are forced to buy.”

Short sellers being forced to buy stocks to stem losses…this is the definition of a short squeeze.

I certainly don’t know if or when any stock will squeeze. But I do know I wouldn’t want to be on the other side of these trades.

What do you think is next for short sellers? Leave a comment at the bottom and let me know!

More on markets:

AMC Fails to Deliver Hit 9.7 Million

Wall Street Banks Turn on Each Other as Federal Probe Looms

New Law Could Put Big Short Sellers on the Endangered Species List

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.

Photo: “the Great Hedge Fund Hei$t” by eyewashdesign: A. Golden is licensed under CC BY-NC-ND 2.0.

The Top 5 Things I’ve Learned from Angel Investing

Some day, I want to look up at a big billboard in Times Square and say, “I knew that company when it was three people. And I saw what it could be.”

But how do I get there?


Get the blog before anyone else…subscribe!


I’ve been investing in early stage startups for 15 months today. I went from knowing absolutely nothing about the field to a portfolio of 13 companies.

Here are my top lessons so far:

1) Pay close attention to margins and scalability. Pure software businesses can scale easily.

For businesses that sell physical products, it’s much harder. It’s tough to sell 10 times as many physical goods as you did last year.

In today’s supply chain hell, it may be hard to even find the goods!

But strong software businesses can grow at warp speed. It’s no wonder that all the biggest winners in startupland are pure software businesses.

2) Build relationships with top investors. I don’t know for sure who will find the next billion dollar business.

But I have a pretty good guess of who it might be: someone who has found one before!

Build relationships and co-invest with investors whose track record is strong. They have the great dealflow you need.

3) Look at lots of deals. I look at 100-200 deals a month.

I choose one.

Look at lots of deals from top investors. This will give you a good idea of what the best companies in the market are right now.

Those are the companies you want to be in.

4) Help founders. This not only helps your existing investments, it builds your reputation in the industry.

The stronger your reputation is, the more good deals will come your way. Plus it’s fun!

What each investor has to offer is different.

I’m best at finding new investors for startups. But other angels might excel at marketing advice, product design or something else.

5) Always keep learning. More than anything, I learn by looking at deals and making investments.

There’s no substitute for actually doing deals, even if you make a few mistakes.

Consider them tuition! It’s a lot cheaper than business school.

I also talk to smart people, read books, and listen to podcasts that teach me more about the industry.

There’s always more to know, and it’s always changing!

Here are some great resources:

Angel by Jason Calacanis

This Week in Startups Podcast

The Power Law by Sebastian Mallaby

Venture Deals by Brad Feld and Jason Mendelson

Bottom Up by David Sacks

Lenny’s Newsletter

This is a field that can be learned. Dig in, find great information, and learn from experience!

If you’re interested in technology and business, you’ll find it very rewarding! You have a small hand in helping create the future.

What questions do you have about angel investing? And how can I improve my process?

Leave a comment at the bottom and let me know!

More on tech:

The Power Law (Part One)

Talking Startups and Today’s Fundraising Pullback

How to Write Investor Updates

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.

Photo: “If God Will Send His Angels” by just.Luc is licensed under CC BY-NC-SA 2.0.