Private Profits Training Module 1: What’s a Private Placement?
October 18th, 2019
In my last update, I introduced you to a different side of the stock market.
It’s a secretive side of the market that’s existed for decades.
In fact, Cambridge Associates — an advisory firm that consults for clients like the Rockefeller Foundation, Harvard University, and the Bill and Melinda Gates Foundation — recently did a study on this market...
It found that it has produced average returns that are SIX times higher than the public stock market average for the past 20 years.
That’s right... six times higher!
It’s no wonder that this is the market that some of the wealthiest folks in America prefer to play in.
But it operates a little differently than the public stock market does.
That’s why I want to make sure you have a preliminary understanding of how it works...
First off, you do not buy shares of companies from an exchange, which is what most investors in America do.
You buy shares of a company’s stock through a private placement deal.
So what exactly is a private placement deal?
It’s a batch of shares offered privately by a young company to a small group of qualified investors.
So you’re buying shares directly from the company you’re investing in.
You aren’t buying them on a public exchange like the NASDAQ or the NYSE, the way you usually would.
You’re buying shares from the actual company itself.
The money you use to buy shares goes directly into the company’s treasury and is then used to finance the company’s business operations.
Essentially, you’re participating in a “capital raise.”
For these young companies, raising capital is the whole point. Capital is the fuel that drives the expansion of the company. It’s the lifeblood of any business.
This is where the biggest gains in the market are REALLY made.
And that’s why the financial elite love these private placement deals... and keep them a secret from everyone else in America.
These are the kinds of deals that can turn a small investment stake into potentially millions of dollars in profits.
Take Uber for instance...
The earliest investors got in through a private placement deal when the company was worth just $5 million.
Today, Uber is worth nearly $80 BILLION.
That’s a mind-boggling 1,599,900% jump in value.
This is the power of private placement deals.
These early investors are getting in for literally pennies on the dollar — often for as little as $0.50 a share — on a company that will trade at $20, $50, $100, or more in the coming years.
They do this all the time.
For example...
Imagine if you were one of the earliest investors to get into Airbnb back in 2009...
A $5,000 investment into Airbnb would now be worth $10.4 million!
Just imagine what you could do with $10.4 million...
Look after your family and friends, pay off your mortgage, put your kids and grandkids through college, buy a boat, and STILL have enough money left over to retire in style.
Well, you no longer have to imagine what having this kind of wealth would be like.
Because you’re finally going to be able to turn the tables on the financial elite.
Instead of hearing about these investments after they become household names... after the big gains are already gone...
You’re now going to be able to get in on them at the VERY beginning, before they blow up into billion-dollar brands.
Because you’re getting there first, the upside you have is infinitely greater.
It’s very exciting. And it’s a lot of fun, too.
In the next training module, I’ll discuss the benefits of this style of investing. And there are many advantages over traditional stock investing.
Sincerely,
Alex Koyfman
Founder, Private Profits Summit
