Why I like private companies

I keep a written life plan that I update once a year. I have done this since around 2010. I rate different areas of my life out of ten: health, family and friends, personal time, work, and finances. The finance section is always the hardest to grade accurately. My family and I moved from Sweden to Marbella in 2018. We meant to stay for two years and are still here, which means our daily living costs are entirely predictable. But a chunk of my net worth is tied up in things I cannot easily value and certainly cannot sell.

I am talking about private companies. The reality of investing in early-stage startups is brutal. If you buy shares in a public index fund, you can sell them on a Tuesday afternoon from your phone. If you put money into a startup, that cash is gone. You are signing up for an illiquid wait that might last a decade. You also have to accept the power law. The maths of early-stage investing dictates that the vast majority of your investments will fail. They will quietly run out of cash, send a polite email to shareholders, and wind down. You need one or two massive winners to make the entire exercise work.

The price of admission

People usually assume the motivation for this kind of investing is purely financial. You hope to catch a wave that returns fifty times your money. I'll be honest with you. While the financial return obviously matters, it is not the main reason I write angel cheques today. I do it because I want a ringside seat.

I invest small amounts, mostly in people I have already watched work, so I can see how they navigate the mess of building something from nothing.

When I came back to Stockholm in my mid-twenties after studying in the United States, I took a sales job at a PR agency. I was on commission only. Everyone around me said this was a terrible idea. That is where I met Fredrik Bage, who told me I would be good at sales, and eventually we co-founded Mediapilot together. We grew that company over roughly seven years and created more than a hundred jobs. Those years were thrilling, exhausting, and chaotic. You are constantly making decisions with half the information you need, hoping you do not break the entire machine.

Later on, when I worked on the commercial side at Happeo, dealing with employee experience and intranet software, I saw a different scale of the exact same chaos. Building a company is incredibly hard, lonely work. When I invest in a private company now, I am essentially buying a ticket to watch someone else play that game. I get to read their monthly updates, see how they tackle sudden crises, and offer advice if they ask for it. It is a way to stay connected to the raw energy of early company building without having to be the one awake at three in the morning worrying about making payroll.

Finding the right room

I do not have a massive fund behind me. I invest small amounts of my own capital. Because my cheques are small, my strategy has to be simple. I mostly back people I have seen in action. I want to know how they handle a lost client, a broken product update, or a disagreement in the boardroom. Right now, I spend my time building Anchor, an AI project supporting alienated fathers, and Substrat, which provides infrastructure for AI builders. Being active in these specific areas means I meet a lot of technically brilliant people. But I still prefer to wait until I have watched them work up close before I wire any funds.

The single strict rule I follow is to never invest money I might need. Private investments are the absolute opposite of sensible if you require liquidity. If everything I have put into angel investments vanished tomorrow, it would annoy me. I would just delete a few rows in a spreadsheet. But my life plan score for finances would not collapse, and it would not change how we live. I would simply have to endure playing bad tennis a few times a week without the distraction of reading optimistic founder updates between sets.

What I still get wrong

I haven't got this figured out entirely. I still get things wrong. Sometimes I am tempted by a brilliant pitch deck or a smooth presentation, even when I do not know the founder well enough to judge their resilience. Sometimes I let my enthusiasm for a piece of technology blind me to a flawed business model, only to realise my mistake a year later. The power law means my failures will probably always outnumber my successes. I am constantly reminding myself to stick to what I know: good people, small cheques, and realistic expectations.

But then a founder sends a short message on a Friday evening saying they just landed their first major commercial client, or that they finally fixed a bug that had been haunting them for weeks. I remember exactly how that felt twenty years ago in Stockholm. The illiquidity of the asset suddenly does not bother me at all. I am just happy to be sitting by the ring, watching them fight.