50@50

Why selling at 50% target profit

1. A hyper-growth stage can usually last for just a few years. We are talking 100% YoY, and it is hard to continue to grow like that. 

2. Hyper-growth companies have hyper volatility, and what goes up fast also comes down. Even if the company is doing super well, having liquidity means that any tale event can hurt the company’s valuation. If it does happen and you did take a profit, you can use it to increase your position or own the same with less capital. 

3. We are selling into strength (trending up) when liquidity is abundant, which guarantees we can exit the whole position well and leave upside for the buyer for good karma. 

Why sell only 50% of the position? 

1. The market reaction to hyper-growth can sometimes surprise you, and the valuation will go twenty times higher or more than you thought it could do ten times. 

2. The hyper-growth can increase or last longer. 

3. Companies are looking for long-term capital, and this way, you stay part of it.