Excerpt from Alena Starostina's interview with Tim Draper in Tech Fashionist.
What advice can you give to people who are just starting with investments?
Well, entrepreneurs should look at taking investments as: take care of that money better than you take care of your own money. Look to use that money to take the chances, to take the risks that they feel they need to take to make the business successful. For new venture capitalists, I would say, there are a lot of entrepreneurs out there, be very careful about who you back. There are a lot of opportunities for investment; you don’t have to jump on the first train that comes by.
What is the most common mistake you see people make when they invest?
The mistakes are usually when people are making an investment decision on, “Hey, this is really interesting", or about, "How could this be better?” Instead of saying, “This is really interesting, but 15 years from now, this is what their world is going to look like.” Having that perspective, that 15 year perspective, I think makes all the difference. I think people should invest thinking very long term, at least venture capitalists should invest very long term with the idea that some of them are going to work and some are not.
So you learn from your mistakes?
No! It would be a mistake to learn from my mistakes because as a venture capital investor you have to keep an open mind. Which means, if you’re saying, “Hey, that was a software company and they lost me all my money, I’m never investing in a software company again,” you’re learning something, but you’re making a huge mistake because software companies will make you a lot. I think you’ve got to look at it as, you’ll learn, but when you make mistakes, they’ll usually be under different circumstances, so you’ve got to pick up on the nuance.