$300,000 · 2,200× at listing
Garry Tan
Coinbase, 2012
A seed cheque into a company operating in a category most investors would not touch, held through the listing rather than sold into it.
What happened
Initialized Capital, co-founded by Garry Tan, put a combined $300,000 into Coinbase at seed. When Coinbase listed directly in April 2021, that position represented a reported 0.66% of the company.
At the first day's closing price, Forbes calculated the return on the seed cheque at more than 2,200 times invested capital. Subsequent figures quoted for the holding — including numbers well above $2bn — reflect the share price at particular later dates rather than a realised sum.
The decision that distinguishes this from several other entries here is what happened next. Tan publicly stated an intention to keep the vast majority of the shares rather than sell into the listing, which is the opposite of the pattern the Thiel entry describes.
The category context matters. Coinbase was funded at a point when a great many serious investors regarded cryptocurrency as unserious, which is precisely the condition under which entry prices are low and the eventual multiple is large.
Where sources disagree
What we do not claim
Dollar values attached to this holding differ widely between reports because Coinbase's share price has been volatile — figures from around $680m to over $2.4bn appear in credible outlets at different dates. The 2,200× multiple at first-day close is the stable anchor and is what this page uses.
For your own cheque
What an angel takes from this
- Backing a category that respectable investors dislike is where low entry prices live. This is uncomfortable advice, because most categories that respectable investors dislike are disliked for good reasons and go to zero. The point is not contrarianism for its own sake but that consensus and price move together.
- The holding decision is the counterweight to the Thiel entry, and the two should be read together. One investor sold into liquidity and realised a spectacular return that was a fraction of what holding would have produced; another chose to hold. Neither was obviously wrong at the time, and only one of them had decided in advance.
- Note how the figures behave. The multiple at a fixed event is stable and quotable; the dollar value is not. When you record your own outcomes, anchor to the event.
See them at work
Watch
Design for Startups by Garry Tan (Part 1)
The same Garry Tan whose seed cheque into Coinbase is described on this page, teaching at YC. Worth watching for what he was doing before and around the investment rather than for the investment itself.
Published by Y Combinator. Channel verified from ycombinator.com, and YouTube's own oEmbed response names that channel as this video's author. Pressing play loads content from YouTube.
Checked, not remembered
Sources
Every figure on this page is traceable to published reporting. Where credible sources disagree we say so above rather than picking the most quotable number, and we do not state what a stake is “worth today” — that moves with the share price and is stale the moment it is written.
The mechanics