Codie Sanchez explains venture zombie investing, where Andrew at Tiny Capital buys struggling startups like Girl Boss from burned-out investors at a discount, then runs them to profitability. It's the opposite of chasing unicorns, more like Warren Buffett's playbook.
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My friend became a billionaire with this simple idea. This is Andrew. He owns tiny capital. But he's not just your average investor. He had a brilliant and kind of stupid, simple idea, and I'm going to call it venture zombie investing. Venture capitalists invest billions and billions of dollars a year trying to find the next Elon Musk or Jeff Bezos. Turns out there's not very many of them. There's only a thousand unicorns or billion dollar companies in the world, which means each year, tens of millions of companies take a bunch of cash from people like Andrew and they burn it. Some of these companies never make much of anything. Like Sophia, Omarosa's girl Boss. It raised 3mil, gets big enough to outgrow its valuation of 13 million. So the company can continue zombie until they run out of cash. Or Andrew steps in. He does what's called a cap table swipe, where he gets rid of old investors, buys the companies for pennies on the dollar, gives them a chance to potentially earn back their money if he runs it. Win, win, win. Andrew's been compared to the Warren Buffett of our generation. I can see why, and it might be why it's worth a billion dollars now.
