If you think getting rich is about a “diversified portfolio” when it comes to investing, maybe investing in startups isn’t for you. While diversification will keep your money “safer” (if there is such a thing), funding startups and making acquisitions is about focus and making big bets in businesses that are often wild and crazy. Here are some tips for those who like to put their arms up when on the rollercoaster.

Invest in businesses you can influence.
Put yourself into investments where you can help make things happen. This is called “smart money,” which means you can provide consulting or advice to the project rather than just injecting money. Play to your strengths, and consider how you can steer or help a business become more successful instead of being a bystander hoping for success.

A decade ago (in my younger years), I invested in a friend’s dream and bought a bar and restaurant. It ended in spectacular failure. I had partnered with the wrong operator and was not in a position to influence the business’s success. Aside from being an avid foodie and wine connoisseur, I knew nothing about the restaurant business (and still don’t). I learned to stick to companies I knew more about or things I could influence.

Make it clear what types of help you can provide. Help with marketing, consulting, and introductions are most common, and that is what I often offer to startup founders. For example, my marketing firm provides email marketing services to an eCommerce company I am invested in. The founder calls me when he wants my thoughts on big decisions or when he needs help. Often, they ask about problems I’ve solved before for my own companies. As a business broker, when an acquisition opportunity came their way, I performed due diligence, vetting, and financing—buying that website doubled their company revenues and profit margin. These are concrete ways of influencing what you’ve invested in to ensure success. Use your talents to benefit them, which helps you. [Continue Reading in XBIZ Magazine]