For the last twenty years, Wayne and I have been “hooked” on investing in pre-IPO start-ups.
We still invest in traditional assets like stocks, bonds, and real estate...
But investing in start-ups gives us something extra — something other investments can’t.
Part of the “addiction” is the market-beating returns. But there’s more to it than that.
So today we’ll reveal the three reasons we got hooked on start-up investing…
And the three reasons we believe investors like you should get hooked, too.
#1: A Little Bit Can Go a Long Way
Here’s the first thing you need to understand about start-up investing:
Even a tiny bit of it can go a long way.
Let me explain what I mean…
Most investors understand the benefits of a diversified portfolio. For example, maybe your portfolio consists of about 50% stocks, 25% bonds, and 25% real estate.
But as it turns out, adding even a tiny bit of “private equity” to your portfolio — in other words, investing a small amount into private start-ups — can have a huge impact:
According to a recent study from SharesPost, an expert in private securities, allocating just 6% of your assets to start-ups can boost your portfolio’s overall returns by 67%.
With a 67% boost, instead of earning, say, 10% a year, you’d earn 16.7% a year.
Let’s see what this difference would add up to with a hypothetical portfolio of $100,000…
Double Your Portfolio with Start-Ups
If you earned average returns of 10% a year, in ten years, a $100,000 portfolio of stocks, bonds, and real estate would turn into about $259,000.
Not bad...
But in that same timeframe, a portfolio that includes a 6% allocation to start-ups (that’s just $6,000) would grow to $468,000.
As you can see, by adding a small allocation to start-ups, you nearly doubled the size of your investment portfolio.
Keep in mind, these returns include the winners and the losers…
And if you happen to invest in a start-up like Facebook, Uber, or Instagram — the type of investment that can deliver 20,000%+ returns — you could become a millionaire overnight.
But higher returns aren’t the only reason to get hooked on start-up investing…
#2: Portfolio Protection
You see, not only can adding start-ups to your portfolio increase your overall returns…
But it can also decrease your risk.
That’s because start-ups are what’s called a “non-correlated asset.”
In other words, when the market zigs, they can zag. That means, in times of market turbulence, start-ups can help smooth out all the ups and downs of your overall portfolio.
For many investors, this “portfolio protection” helps lead to a better night’s sleep.
#3: This One Might Surprise You
But there’s also a third reason you should get hooked on start-up investing.
I’ll let Wayne explain more tomorrow…
But once you read his article, I think you’ll understand why we got hooked on start-up investing — and why you should get hooked, too.
So stay tuned…
Wayne will be emailing you tomorrow morning at 11am EST.
Happy Investing
Best Regards,
Founder
Crowdability.com
