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In the world of startup investing, one question consistently emerges when potential investors evaluate opportunities: "Who else is investing?" This seemingly simple question reveals a fundamental aspect of human decision-making—we seek validation and insights from others, especially when navigating complex or high-risk decisions.
When building Shuttle, almost every investor pitched would ask: "Who else is investing?" Initially, this seemed puzzling. Shouldn't investors make decisions based solely on the company's merits rather than who else was involved?
However, this question persists across the investment spectrum—from seasoned venture capitalists to first-time angel investors. The reason is deeply rooted in how we make decisions under uncertainty. What matters is who's investing only when we are also inclined toward investing. We probably want to talk to them to understand their point of view.
This behavior isn't unique to private markets. Even with public companies, investors seek multiple perspectives:
If investing in ITC or some public company or even an IPO, we can go to Twitter and get 10 opinions on it. While we can run our own analysis, we want to do a sense check. Maybe we have a contrary opinion—we would still want to hear what other people are saying.
The difference? For public companies, these perspectives are readily available. For early-stage startups, they're nearly impossible to find unless you're deeply connected in the ecosystem.
Recognizing this need for transparency, we built several key features into the Misfits platform:
The first feature we implemented was what we called "commitment cards"—showing not just who was investing, but why they chose to invest. This adds crucial context that transforms a simple name into valuable information.
A card showing that Avish or Vishal is investing is superficial. We wanted to get people to tell us why they are investing.
When investors share their thesis—perhaps they're impressed by the founder, believe in the market opportunity, or see a competitive advantage—it provides others with specific areas to evaluate. If five people mention the founder's exceptional abilities, other investors know to pay special attention to the founder's background and capabilities.
We noticed an interesting pattern in early discussions: when people shared why they were investing, they focused exclusively on positive aspects. This created an incomplete picture.
When these investment theses were coming out, there were only good things to say. There was nothing about the risk.
To address this, we began encouraging investors to highlight risks alongside opportunities. This balanced approach serves multiple purposes:
If an investor is investing in a company and the app asks what risks they feel are present, they call it out. And two years from now, when that company fails, that helps them learn.
This transparency about risks also helps other investors make more informed decisions:
If Amit sees it, he's able to understand, "Okay, this person is investing even after these risks." Now Amit could, if he knows me, directly reach out, talk to me. "Hey, what are you thinking? How are you thinking about it?"
Unlike traditional investment disclaimers that appear in tiny print at the end of advertisements, we bring risks front and center:
The risks have to come out specifically in a segment like investment, which is even more risky. It is important that we bring the risk disclaimer up front.
As our platform evolved, we added investor profiles that showcase each person's portfolio and investment theses. This creates a powerful learning tool:
This is my way of introducing myself as an investor. This is the kind of investor I am.
These profiles allow investors to see patterns in others' investments. Is someone consistently investing in SaaS companies? Do they have a track record of successful picks? This context helps build trust and facilitates deeper connections between investors.
If you are investing so much in SaaS, maybe next time I invest in a SaaS company, I'll check with you.
Perhaps the most powerful aspect of this transparency is how it creates a learning flywheel for everyone involved. When investors document their thinking and revisit it later, they improve their own decision-making:
At some level, I may forget what I was exactly thinking at that point in time when I made that investment. Now there's a marker there—this is what I was thinking.
This documentation creates accountability and reflection:
Oftentimes we should say, "I was such a novice at that point." Every year, if you don't think that you were really dumb a year back, then what have you done in the year?
The ultimate goal of these transparency features is to build a community where investors learn from each other and make better decisions collectively:
The fact that an investor who is currently investing is openly able to share their thesis with other potential investors is so powerful that others could understand the reason why they should also look at that opportunity.
While many investment platforms focus solely on transaction efficiency, we're building something different:
We want to go beyond that. We saw a latent need in users to understand what's going on, which sort of businesses are successful, what can I learn that is applicable in my business.
By making startup investing more transparent and social, we're not just helping people diversify their portfolios—we're helping them become better investors and business thinkers.
If people can put in small checks in more companies and be invested in those journeys and learn along the way, they will become a lot better at what they do in their jobs. Their understanding will be a lot wider.
In a world where learning about business typically happens through formal education or direct experience, this approach creates a third path—learning through thoughtful, transparent investment in multiple companies simultaneously.
