Josh Browder, 24, says he lives a "very frugal life."
It’s why when he received about 30 parking tickets, he fought every single one. It’s why he founded his company, DoNotPay, which swayed investors like Andreessen Horowitz with its artificial-intelligence tech to help people fight small claims. And it’s why after he was selected for a Thiel fellowship in 2018, with its $100,000 stipend, and dropped out of Stanford, he didn’t spend the money on living expenses.
While others used the cash for things like housing, Browder was "risking it in the startup casino," investing it in five of his friends’ startups, he told Insider.
Two of those five investments — one in a company called Luminous Computing and the other in Profitboss — have already increased tenfold, he said.
Those investments earned Browder a rare investing track record for someone his age and convinced other investors, known as limited partners in the venture world, to trust him with $7.6 million across two funds to invest on their behalf. He’s invested in about 46 companies, with check sizes ranging from $10,000 to $150,000.
While he’s mostly focused on seed investments (often the first check into a company), he invested in the fintech unicorn Pipe after its Series A.
Despite Browder’s résumé, being a 24-year-old fund manager was a tough sell when he was talking to prospective investors. Some older LPs told him he should hire someone with more experience to run the fund. He didn’t agree.
"Gen Z is shaping the future," Browder said. "And a lot of the most exciting companies are started by people under the age of 26."
Browder is among a wave of young people who want to make their own investments earlier in their careers. There’s a Slack group for Gen Z VCs with over 9,000 members, and new graduates are increasingly making their own angel investments.
"There’s this myth that you have to either, like, work for 10 years in VC or you have to be an operator for 10 years to start raising your own fund," he said. "But I’m lucky — I’ve done it — and there’s nothing special about me beyond working hard and trying to help these companies."
Some Gen Z grads fear that going the route of becoming an associate at a major firm might hamper their career in the long term. One of them told Insider that the pay was high ($210,000, including bonus) but that the firm barred associates from making angel investments, preventing them from building a track record.
Browder said he believes that younger investors are not "jaded by experience" and could often offer unique assistance to companies, like social-media or SEO expertise.
He said Gen Z investors who want to invest now rather than spend years paying their dues at a large firm could start by writing small checks for their friends’ companies, even just $500. In his experience, he said, a track record of five to 10 companies can be enough to convince LPs to invest.
Just a few years ago, Browder was still a student at Stanford scrambling for small checks to keep DoNotPay afloat.
Now, after dropping out and raising millions for his own fund, Browder is writing the checks he used to dream about. He’s ready to prove that young VCs can hold their own among top-tier investors.
"The future is with Gen Z," he said.
Margaux MacColl August 6, 2021 at 08:00PM