OpenAI has taken the world by storm — and investors want in.
OpenAI is the Artificial Intelligence (“AI”) company behind ChatGPT, the technology that can generate human-like text.
ChatGPT can write essays or computer code for you, engage in philosophical conversations, or help you with shopping, a health issue, or even a job search.
In 2022, the startup didn’t make a dime. But this year, it’s expected to bring in $300 million. And next year, it’s expected to make at least $1 billion.
Makes sense. According to Next Move Strategy Consulting, the market for AI is expected to grow 20x by 2030, to about two trillion dollars.
OpenAI is the current leader in this exploding sector, and investors are begging to get in. Microsoft (MSFT) has already pumped $13 billion into it.
Want to get your hands on some of its shares? I don’t blame you. But it won’t be easy. You see, OpenAI is a private startup. That means its shares don’t trade on a public market like the NYSE.
But today I’ll show you how to snag shares.
Bigger, Faster Profits
Before I explain exactly how to get some OpenAI shares, let me set the stage here.
Wayne and I founded Crowdability about a decade ago to help regular people invest in startups.
The reason was simple: startups are one of the most profitable asset classes of all time.
For example, Cambridge Associates — a financial advisor with clients like The Rockefeller Foundation, Harvard University, and the Bill Gates Family Office — recently released a study. It tracked investment returns across all asset classes over a 25-year period. It compared returns from stocks, bonds, and pre-IPO investing.
And as it found, over a 25-year period, pre-IPO investing was the highest-returning asset class by far. Stocks and bonds returned low single-digits. But investing in private companies returned an astonishing 58% per year.
At that rate, you could turn a $10,000 investment into $1 million in just 10 years.
That’s why so many investors get involved in what are called Venture Capital Funds…
Venture Capital Funds
Venture funds are similar to mutual funds.
But instead of investing in stocks, they invest in startups.
Investing in a venture fund might be exciting and lucrative. But it doesn’t come without downside. For example:
- The minimum investment typically ranges from $100,000 to far more than $1 million.
- When you invest in a fund, you have no control over how your money is invested. You take the “good” investments along with the “bad.” It’s all up to the fund manager.
- The fund managers charge outrageous fees and commissions. For example, not only do most funds charge you a 2% management fee each year, but they also take 20% of your profits. Over time, that could add up to hundreds of thousands of dollars of your money going into someone else’s pockets.
That’s why we were excited to hear about a new way to invest in startups…
It’s called Sandhill…
Sandhill is an investment platform for private startup shares.
Specifically, it connects investors with startup secondary shares.
Secondary shares are stakes in startups owned by a startup’s founders, employees, or early investors. And by selling some of their shares to you, they can get cash today, before the company goes public.
Sandhill takes a bunch of these shares, puts them in a pool, and then lets you buy a piece of the pool for as little as $5,000.
This solves many problems — among them:
Access – Getting access to top startups like OpenAI is challenging. But over the past 90 days, Sandhill has granted investors access to shares in companies including OpenAI, Stripe, SpaceX, Databricks, and Epic Games.
Minimums – The minimums are more reasonable. $5,000 gets you in.
Fees – Instead of all the ordinary fees and commissions charged by venture funds, Sandhill charges a flat fee of $149/month, with a 12-month commitment.
Potential Liquidity – The company says it’s creating a marketplace where you’ll be able to sell your stakes to other investors. That means you can potentially turn your shares into cash if you need the money to pay your mortgage or rent.
So, are we giving Sandhill two thumbs up? Not so fast…
The Downside of Sandhill
Sandhill is far from perfect. For example:
- It’s only for wealthy “accredited” investors. That means it’s only for investors who have a net worth of over $1 million, or earn more than $200,000 per year.
- Although you won’t need millions of dollars to get started, you’ll still need $5,000 per deal. And given that we recommend investing in at least a few dozen startups over time so you’re properly diversified, that adds up to nearly
- The companies it features are already valued at many billions of dollars. For example, OpenAI is already valued at nearly $30 billion. Databricks is worth $36 billion. And Stripe is valued at $50 billion. Those are huge numbers, and it means your upside is capped. To make the biggest potential gains, you need to get in much earlier, at far lower valuations.
Here’s What We Recommend Instead
So here’s what we recommend instead:
To get into the highest-potential startups earlier…
Regardless of your net worth of income…
With minimum investments of just $100, or even just $20…
Stick with Crowdability.
Here are two easy ways to dive in.
First, browse our free weekly “Deals” email. We send this out every Monday at 11am EST, and it contains a handful of new startup deals for you to explore.
Second, check out our free white papers like “Tips from the Pros.” These easy-to-read reports will teach you how to separate the good deals from the bad.