Picking winning early-stage investments comes down to picking people.
Building great companies is all about picking great people.
No matter what, people are the secret.
Here’s what sucks about that: people are AMAZING at faking competence now, and the legacy credentialing system is a graveyard.
Institutions manufacture obedience, stamp it with a degree, and convince the market that compliance is a proxy for competence. The modern arena requires radical agency, undeniable execution, and the ability to architect systems that scale without human friction. The traditional signaling mechanisms are broken. Everyone knows which signals to send.
Succeeding these days involves seeing through people.
AI has changed everything. We are now playing a game of infinite cognitive leverage where AI multiplies the output of the hyper-competent and eradicates the utility of the average. Ironically, this means despite the wonders of AI agents the real thing you have to get right in this moment is people.
As leverage increases, people get more important, not less.
What To Look For In People
You must discard the comfortable illusions of corporate pedigree and evaluate the raw underlying physics of a founder. The market is ruthless, the technological acceleration is absolute, and the margin for error was already near-zero before AI. Things are getting even more competitive now. You must isolate the true indicators of sovereign singularity from the noise of manufactured prestige.
Early founder signals dictate the entire trajectory of an enterprise.
Let me show you the types I’ve discovered after doing diligence on over 2,000 start-ups while investing at McDonagh Family Office.
The apex predators sit in the highest tier of my evaluation matrix.
If you are lucky enough to be in a room with one, you will know it, and you should figure out how to work together.
These are the individuals who possess an ability to distort reality and force the universe to conform to their will. If you have the opportunity to invest in a company being built by one of these people, lean all the way in.
The best founders get in rooms they were not invited to. This is the ultimate test of pure agency. They bypass the gatekeepers, ignore the velvet rope, and hack the social hierarchy of any industry they target. They understand that permission is a manufactured illusion designed exclusively to keep the average in their place. I’m not talking about violating double opt-in introduction rules, or any other decorum your network observes. I’m talking about the rare people who find a way or make a way. They build backdoors into the inner circles of power, capital, and influence through velocity and audacity.
Audacity is the first protocol of infinite leverage.
The best founders fail often but win big.
They optimize for asymmetric upside, they absorb calculated losses with zero emotional attachment, and they compound their learnings exponentially.
The majority of the population optimizes their entire existence to avoid looking stupid in front of their peers. The apex founder treats failure as a basic data acquisition cost in the pursuit of geometric growth.
You will see as we go further into the singularity, survival belongs to those who weaponize chaos.
People follow the best founders even without a title. Authority derived from a corporate hierarchy is incredibly fragile and instantly dissolves the moment the paycheck stops. True leadership is magnetic, gravitational, and entirely decoupled from a business card or an organizational chart.
The elite founders compel top-tier engineers, operators, and investors to abandon safe harbors to build something mathematically impossible. I’ve seen it over and over.
Sovereign gravity cannot be faked.
The best founders have a weird specific obsession nobody else has. They go deep into obscure subreddits at three in the morning. They spend their weekends reading technical whitepapers on archaic systems that no one cares about. They track obscure variables that the rest of the broader market ignores entirely. The highest returns in venture come from knowing something the rest of the world considers irrelevant, or fusing several things like this into a novel form.
Obsession is the raw material of the singularity.
Directly below the apex predators are the executioners. These Solid A Players are the engines of the digital economy, defined by their relentless output and pragmatic approach to the internet.
As much as I love apex players, they are extremely rare. You will find executioners anywhere you find success occurring or companies growing.
These folk build for fun. Intrinsic motivation scales indefinitely across any timeframe and any market condition. Extrinsic motivation shatters the exact moment the macroeconomic environment turns red and the venture capital dries up. If a founder only writes code or ships product when money is flowing, they will inevitably collapse under the extreme pressure of a bear market cycle.
Builders have an inherent immunity to market sentiment.
They have sold stuff. The transaction is the ultimate, objective arbiter of truth in capitalist systems. Selling digital or physical goods requires a fundamental understanding of human psychology, value proposition, and distribution mechanics. It forces a brutal collision with the reality of consumer demand and strips away posturing.
They create far more than they consume.
They write raw code, they produce high signal content, and they ship features continuously.
The majority of the human population serves as passive sinks for algorithmic feeds designed to harvest their attention. The elite subset manipulates the algorithm by feeding it relentless, high-leverage output.
Often, these “A-Players”, our executioners, are intrinsically contrarian.
Consensus inherently yields average returns by the basic laws of mathematics. To generate alpha in any domain requires betting aggressively against the herd and being proven right by the passage of time.
They view popular opinion as an inverse indicator of actual value and orient themselves accordingly.
Alpha generation demands intellectual isolation from time to time.
Below the executioners are the capable operators. These Solid founders possess foundational skills required for survival, but lack the feral edge of the tiers above them.
Solid founders are good storytellers.
The ability to craft a compelling narrative is a structural requirement for early stage capital formation, for example.
You must convince elite investors to part with their liquidity, brilliant engineers to part with their time, and skeptical customers to part with their attention. Narrative dictates the bounds of reality until the mechanical execution catches up to the vision.
Reality distortion fields are built on conviction.
Solid founders learn new tools on their own. We are operating in an environment of unprecedented, violent technological acceleration. The tool stack you master today will be rendered entirely obsolete in months by autonomous agents or whatever comes next. Autodidacticism is the baseline defense against total irrelevance in a rapidly shifting world.
The capacity to autonomously learn is the most durable asset.
We now enter the danger zone. The institutions have programmed you to respect certain metrics, but these metrics are fatal traps in the arena of infinite leverage.
Avoid the founder relying on a purely good resume. A resume is a historical receipt of bureaucratic compliance.
It tells me you sat in a chair, followed arbitrary instructions, and did exactly what a mediocre middle manager requested of you. We are building systems for infinite leverage, not assembling a slow moving corporate hierarchy of paper pushers.
Peter Gregory was right.
If you don’t get that reference, please watch Silicon Valley on HBO. It’s created by Mike Judge and it is brilliant. He created a character, Peter Gregory, who perfectly encapsulates what I am saying here. RIP to the actor who played this role, Christopher Evan Welch.
TLDR; avoid the founder leaning heavily on a good school.
Elite universities operate as massive hedge funds with a legacy teaching side hustle attached to them.
They practically filter for obedience and standardized test taking ability rather than independent thought. They do not select for the aggression, risk tolerance, or the raw agency required to birth a company into existence.
Pedigree is a rapidly decaying asset in an open source world. Avoid the founder parading good titles. Corporate titles are participation trophies distributed to pacify the administrative class. They effectively mask total incompetence behind the shiny veneer of institutional authority. A former Vice President of Strategy at a stagnant monopoly brings near-zero utility to a startup trench where survival requires actual output.
Status relies on the decaying institution, while agency relies entirely on the self.
Finally, we reach the abyss. These are the faux-founders who drain capital, destroy morale, and guarantee failure. You must run from these people with maximum velocity.
Run from anyone claiming they are passionate about entrepreneurship. Entrepreneurship is not a hobby, a trendy lifestyle brand, or a social club for the intellectually bored. It is a brutal, unyielding process of capital allocation, extreme risk management, and constant psychological warfare. Passion evaporates instantly the moment the payroll account is short and the production servers crash on a Sunday night.
Competence scales infinitely, while passion bleeds out at the first sign of friction.
Run from anyone who labels themselves a “strategic thinker”. This phrase is code for an inability to execute hard tasks. You will get a plan with some options + a list of people to hire to “implement”. We live in a world where an AI can generate a thousand brilliant strategies in three seconds for fractions of a cent. It can implement too.
The bottleneck has moved, and these people will never do the work to account for the (constantly accelerating) changes we see from the singularity.
Relentless execution eats theoretical strategy for breakfast, lunch, and dinner.
With GitHub and other tools, it’s never been easier to see who’s working, what they’ve worked on, how THAT is working out, and so much more.
Run from the perfectly formatted CV with nothing built. These individuals have spent countless hours adjusting margins, optimizing fonts, and selecting power verbs to describe trivial achievements. They have spent absolutely zero hours deploying code, launching actual products, or testing markets with real capital. They are optimizing their lives for a legacy game that no longer exists in the modern economy.
Aesthetics without output is terminal vanity.
Ready for my biggest red flag?
Run from the founder who has no one to back them.
The ultimate, undeniable red flag is a total absence of a loyal network. If former colleagues, past seed investors, or childhood friends refuse to bet their time or money on this person, the market has already spoken. Social capital is the leading indicator of future financial capital.
This may sound harsh, but you must optimize your network for cognitive capital, raw agency, and a bias toward relentless action. People who possess these traits will build the infrastructure of tomorrow, leveraging autonomous systems to compound their output exponentially. They will rebuild legacy industries and orchestrate the transition into an era of total technological abundance.
Capital must be deployed into the hands of the best builders to ensure we maximize our civilizational return on time and return on energy.
I believe the acceleration of artificial intelligence will eradicate the mediocre tier of intellectual labor and elevate supreme competence to absolute dominance.
We are engineering a reality where human limitations are transcended by autonomous sovereign systems.
What a time to be building, but only with amazing people!
👋 Thank you for reading Wealth Systems. I started Wealth Systems in 2023 to share the systems, technology, and mindsets that I encountered on Wall Street. I am a Wall St banker became ₿itcoin nerd, data engineer, agentic engineer & family office investor.
…or you can find me on LNKD.
💡The BIG IDEA is share practical knowledge so we can each build and optimize our own wealth engines and combine them into a wealth system.
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