Startup companies come and go. On this fast paced modern culture, only the well-funded and strong survive.
Many companies fail within the first year, whether traditional mortar and bricks companies or online ones. Unfortunately, there is absolutely no way to share on paper those will succeed, those will fail and which can make you another dot com millionaire.
Spending in these businesses can be carried out by itself, as the principal buyer or as a silent partner. This, however, requires that you have your eye and ears wide open also to be actively looking out individuals who have a good idea or invented a distinctive product and want to start out a business.
Many investors choose instead to work with project capital groups. A project capital group or a venture capital company pools the money of several investors together to fund the next big idea. It also allows you to invest in more expensive companies by joining several other investors.
More importantly, working with other venture capitalists gives you access to a fund manager, who does all the research, negotiations and analysis in order to protect your money and ensure that it is invested in a sound business.
Investing in this type of business also requires patience. Waiting until a company turns a profit can happen immediately but, more likely, will take many years.