De-risking concentration

Nearly all your net worth sits in one illiquid company. This is how founders think about that risk and start spreading it, without betting against themselves.

What founders use for de-risking concentration, ranked by how many answers lean on it.

  1. The best reminder that avoiding ruin beats chasing returns, and that wealth is the money you don't spend. The whole founder... The Psychology of Money Book The Psychology of Money Morgan Housel In 7 answers
  2. The clearest short piece on how to think about giving up and holding equity, and why a smaller slice of a bigger outcome is the... paulgraham.com Essay The Equity Equation Paul Graham In 3 answers
  3. The clearest, calmest case ever written for low cost index investing and leaving it alone. Global, but the mindset travels... jlcollinsnh.com Essay The Stock Series JL Collins In 3 answers
  4. The India reference on short vs long term capital gains, holding periods, and rates for equity, funds, and property, so you... ClearTax Article Capital gains tax in India ClearTax In 2 answers
  5. The most thorough plain-language reference on vesting, cliffs, strike prices, and exercise windows. Read it once and stop being... Holloway Guide The Holloway Guide to Equity Compensation Holloway
  6. A working glossary of the words on your cap table, from the company that stores most of them, so the jargon stops getting in... Carta Article Equity 101 for founders and employees Carta
  7. The India-specific piece: perquisite tax at exercise, capital gains at sale, and the startup deferral, with worked examples in... ClearTax Article How ESOPs are taxed in India ClearTax
  8. A calm explainer of what a secondary actually is, who has to approve it, and how the price gets set, before you raise it with... Carta Article How secondary sales work at private companies Carta
  9. The canonical, no-hype reference on building a simple index portfolio and why costs and discipline beat cleverness. Bogleheads Guide Bogleheads: getting started Bogleheads
  10. The government-backed way to hold gold that pays interest and skips storage, if you want a small gold allocation without the... ClearTax Article Sovereign Gold Bonds ClearTax
  11. What debt funds are, the types, the risks, and their recently changed tax treatment in India, before you park money in one. ClearTax Article Debt mutual funds, explained ClearTax
  12. The India tax angle on a home loan: the deductions on principal and interest, and what actually qualifies for them. ClearTax Article Home loan tax benefits ClearTax

The questions

Understanding your concentration 7

Why nearly all your net worth sitting in one company is the real risk to your family.

My company is doing great. Why should I worry about concentration? 2 → How much of my net worth in my startup should feel like too much? 2 → What actually happens to my family if my startup fails and it is most of our net worth? 2 → Are my salary, my house, and my ESOPs all riding on the same company? 2 → My net worth is almost all startup equity on paper. Is that real wealth or not? 2 → All 7 questions in Understanding your concentration →
Diversifying beyond your company 7

Turning the little liquidity you have into a portfolio that survives a bad outcome.

How do I start diversifying when most of my wealth is illiquid? 3 → Should I sell some shares in a secondary just to build a safety net for my family? 3 → Where should the first money I take off the table actually go? 3 → How big should a founder's emergency fund be, and where should I park it? 3 → Should my diversified money try to beat the market, or just track it? 3 → All 7 questions in Diversifying beyond your company →
eChai Partner Brands The partnership →