With all the negative headlines lately about inflation, the economy, and the stock market, you might be inclined to just put your head in the sand and tune everything out.
Maybe you’re tempted to turn off your TV, shut down your computer, and ignore your financial advisor’s phone calls.
But here’s the thing:
If you do that, you’ll miss out on one of the few bright spots in the market…
And one of the few ways to profit from it.
It Ain’t All Bad News
If you’ve been ignoring the financial news lately, you may have missed a recent report from the research firm Pitchbook.
Pitchbook, which is owned by mutual fund giant Morningstar, publishes data on a very exciting and lucrative area of the market…
But to be clear, the company’s research has nothing to do with stocks, bonds, or options. But it could still help investors make a lot of money.
You see, each quarter, Pitchbook publishes a special report on the private markets…
And according to its most recent report, even though the public markets were down sharply, the first few months of 2022 were a banner quarter for private market investors.
In the first quarter of 2022, Pitchbook estimates that professional private market investors, known as venture capitalists, raised more money for their funds than they did in all of 2019!
More specifically, these private market investors pulled together a total of $70 billion in just three months to go out and invest in startups.
More Profits, More Money
The reason for this growth is simple:
For investors in the know, the private markets have become the asset class of choice.
You see, historically, investing in early-stage, private tech companies was solely available to professional venture capital investors.
But as the profitability of early-stage investing became clear, other types of investors started to invest here, too.
For example, mutual fund giant Fidelity — which traditionally, only invested in public companies already listed on the stock market — has invested billions of dollars into tech companies, like Uber back when it was still private.
No Surprises
If you’re a longtime reader of our newsletter, this shouldn’t come as a surprise.
As we’ve been showing you for years now, the private markets are one of the most profitable asset classes of all time.
For instance, Cambridge Associates — an investment advisor for the likes of Bill Gates and The Rockefeller Foundation — published a study on the 20-year returns of all major asset classes. And its conclusion is clear:
Even when you factor in the winners and the losers, early-stage private investing has been, by far and away, the most profitable long-term asset class.
In fact, as you can see in this chart, these investments have returned roughly 55% per year for the past 20 years.
Think about that:
At 55% per year, in just 20 years, you could have turned a $1,000 investment into more than $6 million.
This is Just the Beginning
And to be clear, for investors like you, this is just the beginning.
You see, the level of capital flowing into the private markets is only increasing.
And the more capital that’s available, the more deals there will be.
And the more deals there are, the more opportunities there will be for you to earn big gains outside of the stock market.
Don’t Go it Alone
But we have to warn you: the private markets don’t come without risk.
If you try to invest in this new market on your own, you could get hurt.
Which is why, next week, we’re planning something very special for you:
If you haven’t done so already, we’ll be giving you the chance to make your first private market investment.
And the best part is, Matt and I will be there to hold your hand every step of the way.
We’ll explain more in next week’s newsletter… so stay tuned!
Best Regards,
Wayne Mulligan
Founder
Crowdability.com
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