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My portfolio is split 50-50: I have $2M in common Vanguard index funds, and $2M in private illiquid equity from a startup I worked for in the past, via options

My portfolio is split 50-50: I have $2M in common Vanguard index funds, and $2M in private illiquid equity from a startup I worked for in the past, via options I exercised. Every now and then someone contacts me interested in buying some shares of that company, which I promptly sell and immediately buy index funds with the proceeds. I liquidated about $1M of those shares already, let me know if you have $2M to burn sitting in your pockets :-) I wanted to invest in some private real estate syndications, but then covid came through and I don’t think it’s a good time to buy commercial real estate. Plus, my job keeps me super busy. To be honest, if index funds end up averaging a return of 3-5% after inflation, it would be more than enough for me, that’s why I keep investing in VTI/VXUS, I have done that for a decade now, non stop. What options are you finding right now? I find that the opportunities available to little guys like me who might not want to put more than 50-100k per deal are incredibly limited.

elamje 6y ago
I’m having to make my own options, which is the fun part. There is an incredible amount of opportunity that’s too small or not scalable enough for VC and PE. You can effectively do both at small scale and that excites me much more than dropping money into the market and praying. At the scale you and I invest at we can make a meaningful impact on the business with our money and involvement, where that isn’t the case for large companies. I like the prospect of small scale private equity where 1 or more people can vastly change the business, and be long term (not looking to raise a fund else investors come looking for a 2x return every few years). And btw, that is a structural problem with PE, they take huge amounts of money and “guarantee” 2 or 3x in 5 years, which means there are a ton of businesses which will never be attractive to them. Dm me on Twitter, or email me if want to talk further offline.

elamje 6y ago

I’m having to make my own options, which is the fun part. There is an incredible amount of opportunity that’s too small or not scalable enough for VC and PE. You can effectively do both at small scale and that excites me much more than dropping money into the market and praying. At the scale you and I invest at we can make a meaningful impact on the business with our money and involvement, where that isn’t the case for large companies. I like the prospect of small scale private equity where 1 or more people can vastly change the business, and be long term (not looking to raise a fund else investors come looking for a 2x return every few years). And btw, that is a structural problem with PE, they take huge amounts of money and “guarantee” 2 or 3x in 5 years, which means there are a ton of businesses which will never be attractive to them. Dm me on Twitter, or email me if want to talk further offline.