“I am oversubscribed and closing the round in three days. I want you in but need you to confirm by Saturday.” It was 2018 and Fancho (CEO of Frubana) was closing his angel round for the company. I believed in the founder, the market, and the product they were building (I was an early employee in Cheetah, which is Frubana in the US). There was only one problem: a week before I had been laid off, losing my US salary and green card (which the company was sponsoring). I was now living in Colombia (where 95% of households make less than the monthly payment on my MBA student loan) with ~$100k in student debt, a mortgage in Seattle, and no job.
As I thought through my options, I realized a few things:
- I would never regret investing in a team I believed in (even if they failed)
- I wanted to get into VC and I knew that investing as an angel was the quickest way to gain experience while supporting founders in the ecosystem
- I believed in my ability to (eventually) get a job that paid enough to cover my loan commitments and living expenses
- Banks love giving loans to people who pay them back
A few weeks before I had received a message from AMEX saying I was pre-approved for a personal loan. I went online and took it. Once I got the confirmation, I called Fancho to confirm I was in. I wrote Fancho a check and asked him to give me a heads up before cashing it in to make sure I had the money in my bank account. That is how I was able to participate in the angel round of a startup now worth over 100x the valuation I invested in (just in case, this does not mean my investment is worth 100x what I invested as you face significant dilution as an angel investor).
I am one of those people who has a monthly budget in Google sheets and always calculates things like personal runways (in case I am running a deficit) or how much money I would save in a given period (in case I am looking to make a payment on a loan or an investment). I always struggled with the duality of being fiscally responsible in my personal life but wanting to take risks in my professional life. It was not until I moved back to Colombia and made my investment in Frubana that I discovered four important things:
- We tend to overestimate career risk: Two weeks after I was laid off I had another job offer. You have a great job because you are a high-impact asset to any company. Not the other way around.
- Startups are the best universities: I could have made a lot of money after business school at big companies. Instead, I worked for startups and leveraged my experience to access highly selective angel rounds. If we treat high-impact, high responsibility roles at startups as educational investments instead of pay cuts, we can make decisions that optimize for long-term learning instead of short-term financial gains.
- You can get creative with your financial constraints: I did not have a safety net to fall back on. Nonetheless, after reaching a certain level of career success, I could do things like getting low-interest loans to invest in my education or buy myself a few months of runway to try something new.
- Banks love giving loans to people who will pay them back: I use this to my advantage, especially when interest rates are low.
We are living in uncertain times. On one hand we have high interest rates, high inflation, slow economic growth and political uncertainty (in the case of Colombia). On the other we have an AI revolution, nearshoring, and a startup ecosystem in Latin America that despite slowing down significantly from its peak in 2021, it is still the most vibrant it has been in many decades.
Many of you are reading this and wondering whether or not you should take the leap. You should. That leap might mean launching your company, joining a new one, having that difficult conversation, or asking that person out on a date. Whatever that leap means to you, taking it will help you grow and (ideally) you will enjoy the journey.
PS: I believe in building a world where every person achieves their potential and started Cocora to connect professionals with coaches and advisors who will help them transform. I hope this article helps you on your journey. Shoot me a note if you are ever interested in finding a top-tier coach ;)
