Thiel’s newest investment: Trump
Even if Trump’s chances for winning the presidency race are only over a dozen percent, supporting him could be still a valid investment opportunity.
Thiel as a startups investor is very comfortable with investing in questionable ventures; actually, investing in this type of firms is the only way to win big in the innovation game. You cannot expect to earn billions by opening just another restaurant, right? With an estimated wealth of $2.7 billion Thiel decided to make another small investment: this time he invested $1.25 million (less than 0,05% of his assets) into Trump’s campaign for a possibility to have direct access to the next most powerful person on Earth.
Analysing this from the perspective of an investor, this is another relatively safe bet. Trump has every characteristics of a potential new unicorn: he has gained a lot of traction and grew from minor, joke-worthy candidate, with few fringe supporters, to a major party nominee, beating all of his party peers — now in a one-on-one duel with Hillary Clinton, with a lot of support. Doesn’t it look similar to many startup stories that at the beginning were considered toys for nerds that would never become serious business, only to dominate whole markets not much later?
Thiel understands that to win big you have to take into consideration the facts and ignore the opinions. Many opinions about Trump are bad but they are irrelevant for an investment to be valid. Moreover, they often represent the “go along with the crowd” thinking that has repeatedly put big corporations out of business. The best startups come from ideas that seem bad but are actually good. None of the big corporations with tons of recourses want to pursue them because they seem silly, childish, unprofessional, risky, uncool — and this is what creates the opportunity.
Is Trump a good idea that seem bad? Or will he end like so many failed startups? Will Thiel get his return of having influence on the next president? Let’s wait and see.
Dislaimer: This is not a piece supporting any candidate. This is just my attempt at understanding Thiel’s rationale for supporting Trump’s campaign from investor’s perspective.
