[OiNG]

Its not even about hedging but about diversification. If you are in a position where you can't diversify fully, you should require a higher return on investment in order to take on the risk.

For example. If you could bet on a coin flip 100k times at $1 a bet, you might be willing to accept getting paid $1.01 per win. But if you had to bet $100k on a single coin flip, you would likely need the payout to be much greater before you were willing to take the bet.

[arachnids]

Both are viable strategies. You diversify when you spend time working for startups across different sectors in the hope that some might succeed in their own area. You hedge when you work for several competitors in the same area in the hope that one of them will win in the end.