10 Reasons Startups are the Best Investment for your Portfolio

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With the 2016 Flashstarts Accelerator well underway, our focus for our Accelerator teams has become increasingly multi-faceted. Mentorship and guidance are key components to the success of our companies, but we also continue to seek investments from supporters eager to advocate for the importance of a robust startup community in Cleveland.


If you’re unsure about investing in startups, give yourself the next 5 minutes to learn why we invest in startups, and why startups are actually a great investment for your portfolio.

1. High risk AND high potential reward in startups. Startups often enter disruptive spaces and have a lot of room for growth and success. While not every startup will be wildly successful, our top mentorship program gives the startups in our accelerator a higher probability for success.
2. Asset class diversification. A portfolio that is diversified is better able to handle market volatility. Early stage investments are themselves a distinct asset class. The companies accepted into our accelerator offer a diverse range of asset classes giving you a more stable investment opportunity.
3. Diversified portfolio of 6-12 startups. Even if one company is not excelling as quickly as you might like, your portfolio is still likely to be gaining value.
4. Extensive Due Diligence. The startups admitted into our Accelerator program are subjected to extensive due diligence meaning that your investment is both well-educated and well-placed because we have done our research.
5. Tax free gains §1202. For individual taxpayers who invest in qualified small businesses (like startups), section 1202 excludes from gross income at least 100% of the gain recognized on the sale or exchange of qualified small business stock (QSBS) that is held more than five years.
6. Tax favored losses §1244. Tax code section 1244 allows losses from the sale of shares of small, domestic corporations such as startups to be deducted as ordinary losses instead of as capital losses up to $50,000 for individuals and $100,000 for returns filed jointly.
7. Support the Cleveland economy. One of the best ways to boost our economy is through job creation. Startups are an unparalleled opportunity for job creation and they help encourage an economy of innovative entrepreneurialism that will drive the Cleveland economy.
8. Invest early for 6% one-time interest rate. If you invest now, when our companies are successful you get a 6% one-time interest rate for the return on your investment. This rate drops 2% each month, so the sooner you invest, the higher your potential interest rate.
9. Joys of angel investing. Successful angel investing can be extremely satisfying – watching young companies grow into success will make you feel like a proud grandparent.
10. High quality deal flow from StartMart and Flashstarts Labs. Our strong pre-existing relationships with entrepreneurs, investors and the movers and shakers of the Cleveland community bring you into our network of positive change and connect you with people with whom your can share the joy, risks, and rewards.

 

To learn more or become an investor, visit our site at invest.flashstarts.com

 

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