If you’ve ever started a company, you know how hard it is to encapsulate your mission in a single name and tag line. You want something that will instantly express the unique benefit you are providing. If you’re Starbucks, that’s easy: Coffee. Everyone knows what coffee is and what it does for you.
For Venovate we landed on these two words: Smarter Alternatives. Let me explain you why.
The investing world is a bit more complex than a coffee shop. Most investors understand securities like stocks, bonds, mutual funds, and ETFs, and many people have walked away from them. That’s not surprising. The past 13 years have been brutal on Wall Street. The dot-com bubble, the financial meltdown of 2008, and the flash crash of 2010 have all but destroyed investor trust and confidence.
Investors want new, alternative investment opportunities. They want opportunities that are not linked to the volatility of the stock market, interest rate fluctuations, and the theater-of-the-absurd that Washington has become.
Venovate’s mission is to provide investors with those alternative investment opportunities. These are direct investments in privately-issued securities, or in funds that invest in things like:
- Growth companies – including private equity and venture capital investments in early and mid-stage growth companies. These pre-public companies are where most wealth creation and job growth have come from in the past.
- Real estate – direct participation in real estate and partnership deals offering both income and potential for appreciation, without the high correlation to the stock market or interest rate sensitivity of a REIT.
- Hedge funds – offering exposure to a wide variety of investment strategies.
- Fixed income – may include bundles of mortgages, student loans, distressed municipal securities and mid-market business loans. These deals offer a mix of low-volatility income and total return.
- Natural resources – such as high-growth oil and gas exploration and production companies, income-producing timber land, or oil services firms. These deals offer the potential for growth or income without price fluctuations caused by the volatility of commodity prices.
Only institutions, family offices, and ultra-high net worth individuals have had some access to these types of opportunities in the past. Venovate is now bringing these alternative investment opportunities to an online platform called Venovate Marketplace. This will make it much easier for institutions to find opportunities and it will drastically expand the market to include all accredited investors and their advisors. Also, through our partnership with Provident Trust Group, these alternative investments can now be made in IRAs and other tax-qualified retirement plans.
Venovate is creating this marketplace so you can find a broad choice of alternative investments, research the details of each deal, communicate online with the sponsor, indicate your interest in deals you like, sign documents electronically, move the money, and receive your shares – all in one place. We are even creating an aftermarket exchange for these alternatives so you may be able to buy and sell deals in a secondary market. All this makes Venovate Marketplace a smarter way to invest in alternatives.
While alternative investments provide investors with a new dimension of portfolio diversification, they are not without risks. They are designed to be long-term investments and most are illiquid. Some, such as non-public growth companies and distressed municipal bonds, involve real risk to your principal. Venovate will give you access to extensive information about these deals for you to analyze. Be sure you understand the deal before you invest in it. These are private-placement securities intended for sophisticated investors. If you are not a sophisticated investor, we urge you to seek advice from someone qualified before you invest.
Venovate plans to create a secondary market in these opportunities, but today the market is very limited for these securities. There is no telling how active or liquid any market that develops will be. So you should not invest any money you’ll need in less than the time frame of the deal. These time frames vary from one deal to the next. Again, be sure to read and understand the information provided by the deal sponsors.
If you are like many investors – frustrated with the traditional investment choices and want a broader set of options – there are smarter alternatives and Venovate is providing them. You can be one of the first to experience Venovate Marketplace. Just sign up for our Beta. We’re curious to hear what you think.