Calculator
Portfolio simulator
Set your allocation and how many companies you intend to back, then describe how you expect those outcomes to be distributed. The tool does the arithmetic — including the one number most angels never calculate, which is the chance of holding no outlier at all.
Your allocation
Your expected distribution
How many of your investments land in each bucket. The counts must add up to your portfolio size — the tool tells you if they do not.
The risk nobody calculates
—
The assumed rate is your modelling choice, not an observed figure. Whatever value you use, the shape is the same: the probability of holding nothing exceptional falls steeply as the portfolio grows, and that fall is the whole argument for portfolio size.
A model, not advice, and certainly not a forecast. It computes the consequences of assumptions you supply. It ignores dilution, liquidation preferences, fees and carry — see the dilution calculator and theexit waterfall calculatorfor those.
What to do with it
Run it twice. Once with a distribution you would call reasonable, and once with one you would call disappointing — usually just moving the exceptional outcome into the total-loss column. The gap between the two results is the range you are actually underwriting, and it is normally much wider than people expect.
Then look at the share of the return coming from the top bucket. In most plausible distributions it is well over half, which isthe power law stated as a number. It is also the reason that effort spent turning failures into break-evens changes almost nothing, while effort spent increasing your chance of holding one exceptional company changes everything.
Finally, change the portfolio size and watch the odds line. Moving from ten positions to thirty is a bigger improvement to your chance of a good outcome than almost anything else available to you — which is whycheque size and portfolio size are the same decision.