Disclaimer: The following is for entertainment purposes only. It is not investing advice. There are no warranties express or implied. Your decisions are your own when and how you choose to invest.
The risk of loss has seven times the emotional impact as the promise of a gain.
I can’t tell you how many times I’ve heard this repeated across a number of books.
Psychology.
Negotiation.
Marketing.
Investing.
The story is the same every time. Because it’s true.
It led me to some late nights doing analysis away from my family that I won’t get back.
But fortune also favors the prepared. Because the prepared can act quickly.
So how do you reconcile the paralyzing fear of a loss with pulling the trigger when you need to?
Use your brain
The answer comes down to what’s sitting between your ears. And the tools you have dictate that.
I can’t tell you the number of times I agonized over an investing decision.
After leaving some high-level finance classes with a powerful spreadsheet, I took every bit of 2 hours to pull the past 10 years’ data for one company that looked undervalued. And that was before even comparing them to their competition.
When the time came to pull the trigger, I was exhausted and uncertain. And I usually missed the opportunity.
It’s a lot easier to say no than it is to find something that works.
Then came advice from angel investors and venture capitalists. They talked about the success they had spreading their portfolio across a number of investments.
Sure, they may have a complete loss on half their portfolio, and a couple more may make some money. But they recouped their losses and more with the one unicorn they found.
Plans, meet reality
Unfortunately, at that time, I didn’t have enough capital to hunt unicorns. I didn’t have a successful exit to fund my goals.
I’m betting you don’t right now, either. But don’t get discouraged. I’m getting to how you can do this with a job and a family.
I didn’t start making money until I learned how to move on momentum and opportunity. Because it helps to have a plan that you know will work for you most of the time. One that can help you be wrong without going broke and still set you up to make money year-over-year. Or having a major trend change completely wipe out the hard earned wealth you built to take care of your family.
I’ve talked before about the 1-2% rule. As in: don’t invest more than what would cause you to lose more than 1-2% of your total cash on one investment.
When you’re doing this for crowdfunding, it gives you the speed to pull the trigger within the timeframe or before others can swoop in to take your spot in line. That way, you can move on to the next opportunity or get back to your workday or daily life sooner.
Living the dream
So what should you look for in a company that you want to invest in?
Revenue: have they made a sale yet? Are their sales growing over time and do they have an effective plan to continue growing?
Management team: have they started/sold a business like this before? Do they have the experience to run this kind of business and are they succeeding in this field? Are they promising the moon or are they being modest about how past performance translates into future results?
Competitive moat: are there other companies in the space you can compare them to? Are they able to differentiate themselves enough that people needing the same things won’t be able to easily switch to a competitor?
Sustainable growth: can they grow the business organically? Or do they have to raise money to pay bills? And is their business plan built on a fad or a sustainable trend?
Ideas in action
Here’s an example of a company I recently invested in. I reviewed their investor materials for maybe 20 minutes before I pulled the trigger.
Outside of my comfort zone? A little. But following the plan kept the momentum without taking on extra risk.
They’re in the beverage business, alcohol specifically. Not something I normally consider, but they have a unique delivery system. Something that can be added to a drink without taking away from the original beverage. They also have a plant in the states, which is the only one in the world capable of making it.
Competitive moat: check.
They also had 5X revenue growth from 2024 to 2025, with modest assumptions it will slow down to doubling yearly after (when they’ve barely touched Vegas yet). They’re driving this with an Instagrammable product appearance that’s getting attention.
If my kids weren’t watching videos of Gen Y parents trying TikTok recipes for themselves, I would’ve passed.
If there weren’t a bunch of boba tea stores popping up in my area that my kids beg me to take them to and generating enough sales to stay open the past 3-4 years, I would’ve passed.
But it has echoes of another beverage brand that built a loyal following and sold for billions to Pepsi Co: Poppi. That’s driving high organic growth at bars and restaurants in major urban centers.
Revenue and sustainable growth: check.
Put on that a management team with executives that understand this and have overseen a nine-figure sale before.
Yes, that 1-2% is ready to go.
Stupid simple works
If I didn’t have that rule, I would have agonized most of the afternoon about how much to put in and whether it would be worth it.
Can I say it’s successful yet? Only on making a decision.
I haven’t invested in crowdfunding long enough to reap an exit. But I’m not losing sleep over it, either.
So don’t sit around. Set a boundary of how much you’re willing to lose. And then start looking for stuff to invest in.
The right tool dispels that 7x emotional drain so you can keep taking care of your family.
Affiliate Corner
The next challenge? Passing this on to your kids in a way they can understand. The Tuttle Twins and the Messed Up Market teaches them what makes a good business as they wind down for bedtime.
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Dig deeper with these related posts before you go:
Liberty Begins At Home 
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