Achieve Returns Like UHNWIs

[vc_row bg_type=”image” parallax_style=”vcpb-default” bg_image_repeat=”no-repeat”][vc_column][vc_column_text]When taking into account inflation, retail investors lost money over the last decade.[/vc_column_text][vc_column_text]According to JP Morgan Asset Management, the average annual return earned by a retail investor for the 20-year period between 1999 and 2018 was 1.9%.  Average annual inflation was 2.2% during this same period.[/vc_column_text][vc_column_text]Why did retail investors lose money?[/vc_column_text][vc_column_text]Maybe it has something to do with their investment strategy, one that picks the easy targets – public equities.  And among public companies, large financial companies are popular investment choices of retail investors. Why? Because; often, when faced with the decision to invest with a large well-known public firm or a small agile private company, retail investors don’t give the private company a second thought. They tend to opt to invest with the large, recognizable company.[/vc_column_text][vc_column_text]The problem with large firms is they often get bloated, bogged down with mismanagement and inexperienced advisors, with leadership often indifferent or immoral, pushing the entire organization toward disaster.  Large firms can not only more easily hide warts but often, as history has proven, allow unscrupulous CEOs, CFOs and accountants to fudge numbers to fool investors, employees, and shareholders. All this to paint a picture that’s rosier than reality, for self-gain and self-preservation. Truth often gets lost in bloat. Dishonest and immoral managers know this and can hide not only mismanagement but outright theft and fraud for long periods before getting exposed.[/vc_column_text][vc_column_text]Here’s the BK Hall of Fame featuring large financial firms…[/vc_column_text][vc_column_text]MF Global (2011) | $41 Billion [/vc_column_text][vc_column_text]MF Global structured its foreign debt trades to make short-term profits. When things went south, the company started using its customers’ brokerage assets to cover its losses from trades.[/vc_column_text][vc_column_text]Conseco (2002) | $61 Billion[/vc_column_text][vc_column_text]Conseco was an insurance and financial holding company. Its aggressive acquisition strategies went horribly wrong as it took massive debts on its books.[/vc_column_text][vc_column_text]CIT Group (2009) | $71 Billion[/vc_column_text][vc_column_text]CIT Group was a financial services firm that invested heavily in the subprime mortgages at the peak of the US housing bubble.[/vc_column_text][vc_column_text]Washington Mutual (2008) | $328 Billion[/vc_column_text][vc_column_text]Washington Mutual ended up filing for bankruptcy due to its extensive exposure to subprime mortgages. JP Morgan Chase now owns much of its retail operations.[/vc_column_text][vc_column_text]Lehman Brothers (2008) | $691 Billion[/vc_column_text][vc_column_text]Lehman Brothers is by far the largest corporate bankruptcy in the US history.[/vc_column_text][vc_column_text]The problem with large, bloated companies is that their management goes largely unaccountable – sheltered in their towers from their shareholders.  You can never get a hold of top leadership, often being relegated to a  company rep at the bottom of the totem pole. When these companies file for bankruptcy or fall in default, the walls go even higher with no one usually ever held accountable.[/vc_column_text][gem_quote style=”4″ no_paddings=”1″]Unlike retail investors, ultra-high-net-worth investors (“UHNWIs”) avoid bloated public companies.[/gem_quote][vc_column_text]UHNWIs prefer smaller, private companies not only for superior returns but also for easily accessible management. In the past 20 years, UHNWIs have largely divested themselves of public equities, turning to alternative investments instead, with real estate and passive private investing representing the bulk of their asset allocations.  To understand the mindset of the UHNWIs, a peek inside angel investing and what motivates angel investors gives valuable insights into why UHNWIs prefer small companies, usually in the startup phase, for investment.[/vc_column_text][vc_column_text]So what are some of the elements of small businesses and startups that appeal to angel investors?[/vc_column_text][vc_column_text]High Growth Opportunities [/vc_column_text][vc_column_text]Small, agile companies seizing on a niche industry or product can provide returns mature companies can not.  Accessibility to management allows UHNWIs to spot winning market opportunities retail investors ignore.  Sophisticated investors are willing to take on risks such as loss of capital, dilution of their share and illiquidity, primarily because of the potential returns.[/vc_column_text][vc_column_text]Killer Management[/vc_column_text][vc_column_text]Small companies with accessible management allow investors to assess the competence of the leaders and the likelihood of a company’s success.  Highly valued management qualities include chemistry (between each other and the investor), in-depth understanding of the target market and sector, relevant experience, flexibility – in terms of being able to adjust approaches and learn from mistakes, and the right skills needed for the current stage of the business.[/vc_column_text][vc_column_text]Scalability[/vc_column_text][vc_column_text]Small, agile companies lead by killer management can position the company for major sales growth on minor incremental costs.[/vc_column_text][vc_column_text]Winning Business Model[/vc_column_text][vc_column_text]Small companies allow potential investors to more easily assess a company’s business strategy and its likelihood of success.  Small companies with a realistic, workable approach to attracting and converting the customers needed to grow and succeed are appealing to the sophisticated investor.[/vc_column_text][vc_column_text]Verifiable Financials[/vc_column_text][vc_column_text]Evidence-based, realistic, and robustly tested financials appeal to the UHNWI. Once again, because of accessibility to records and books, feasible and attractive calculations with the detailed research and data supporting them will attract UHNWIs.[/vc_column_text][vc_column_text]Alignment of Interests[/vc_column_text][vc_column_text]With the rise of impact investing,  more and more investors are backing projects that have a positive influence socially or environmentally, while still making a profit.[/vc_column_text][vc_column_text]One thing is evident as you delve into the investing habits of the UHNWIs, and that is that they prefer alternatives to the bloat of Wall Street.  They prefer small, lean companies that are transparent and make their management available.  Transparency and accessibility allow UHNWIs to asses the most critical elements that can determine the future success of a company, including business plan, financials, management interests, etc.[/vc_column_text][vc_column_text]All you need to do to achieve returns like UHNWIs is to understand and adopt their investment patterns.  Then you’ll be on your way to creating lasting wealth.[/vc_column_text][vc_column_text][/vc_column_text][/vc_column][/vc_row]

DISCLAIMER

This is neither an offer to sell nor a solicitation of an offer to buy the securities described herein.

THE OFFERING IS MADE ONLY BY THE PRIVATE PLACEMENT MEMORANDUM. THIS MATERIAL MUST BE READ IN CONJUNCTION WITH THE PRIVATE PLACEMENT MEMORANDUM IN ORDER TO UNDERSTAND FULLY ALL OF THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES ASSOCIATED WITH AN INVESTMENT IN THE SECURITIES TO WHICH IT RELATES AND MUST NOT BE RELIED UPON TO MAKE AN INVESTMENT DECISION.

The offering of securities described herein will not be registered under the Securities Act of 1933 (the “Securities Act”) or the securities laws of any state and the securities are being offered and sold in reliance on exemptions from the registration requirements of the Securities Act and such laws. Neither the Securities and Exchange Commission nor any other federal or state agency has passed upon the merits of or given their approval to the offering of the securities, the terms of the offering or the accuracy or completeness of the offering materials. The offering of securities is being made only to Accredited Investors, as defined in Rule 501(a) of Regulation D of the Securities Act. An investment in the securities is highly speculative and involves substantial investment and tax risks. All prospective investors must review the Private Placement Memorandum in its entirety, including the section entitled “RISK FACTORS” before investing.

An investment in Four Peaks Capital Partners, LLC is highly speculative and involves substantial risks, including, but not limited to: (1) Four Peaks Capital Partners, LLC success depends upon the performance of the Manager in managing Four Peaks Capital Partners, LLC and its investments, including decisions involving investment of Four Peaks Capital Partners, LLC’s capital and the acquisition and disposition of properties and there is no guarantee Four Peaks Capital Partners, LLC will raise enough capital to perform its investment objectives; (2) There can be no assurance that a prospective investor will receive any return on investment in Four Peaks Capital Partners, LLC and/or realize any profit on a prospective investor’s investment in Four Peaks Capital Partners, LLC and a prospective investor could lose all or a substantial portion of its investment; (3) The Manager has limited or no net worth and there can be no assurance that the Manager will have sufficient funds to meet its obligations to Four Peaks Capital Partners, LLC or to otherwise financially support Four Peaks Capital Partners, LLC; (4) The Class A members and Class B members have no power to take part in the management of Four Peaks Capital Partners, LLC and have limited voting rights and will not have the opportunity to evaluate or approve any of Four Peaks Capital Partners, LLC’s investments; (5) The Class A Interests and Class B Interests will be illiquid, and the transferability of the Class A Interests and the Class B Interests will be substantially restricted; (6) Four Peaks Capital Partners, LLC may not have the cash flow necessary to make distributions to its members; (7) Four Peaks Capital Partners, LLC will not diversify its investments and, therefore, the success of Four Peaks Capital Partners, LLC will be dependent upon the success of the properties; (8) There are substantial risks associated with real-estate investments and ownership of storage facilities and mobile home parks; (9) There are various potential conflicts of interest among the Manager and its Affiliates and their principals.
Investors must read and carefully consider the discussion set forth under the section entitled “RISK FACTORS” in the Private Placement Memorandum for a complete discussion of these and other risks pertaining to this investment.

These projections are speculative and based on specific assumptions, which, if incorrect, would cause the actual returns to differ materially from the projected returns. You should review the entirety of the assumptions and risks set forth in the Private Placement Memorandum.

Any underlying assumptions and any forward-looking statements herein may not be accurate, the projections herein shown may not occur, and actual results could differ materially due to risks and uncertainties that are beyond the Company’s ability to control or accurately predict. To the extent, the information in this communication conflicts with the information in the Private Placement Memorandum, the information in the Private Placement Memorandum shall govern.

The securities offered are an illiquid investment and involve a high degree of risk; Investors should be able to bear the loss of some or all of their investment. Investors should read and understand all of the risks and the entire Private Placement Memorandum before making a decision to invest. Past performance is no indication of future results and there can be no assurance that Four Peaks Capital Partners, LLC will be able to execute the investment objectives for the Properties or the Offering.

This material is for general information purposes only and does not constitute legal, tax, investment or other professional advice on any subject matter. Information provided is not all-inclusive and should not be relied upon as being all-inclusive.
Any capitalized terms used but not otherwise defined in this Presentation shall have the meanings set forth in the Private Placement Memorandum.

Any reference to “Four Peaks” “we” “our” or “fund,” regardless of capitalization, shall refer to Four Peaks Capital Partners, LLC, and its Affiliates.

For additional risks and disclaimers, visit https://www.fourpeakscapitalpartners.com
Four Peaks Capital Partners, LLC

2024 © Four Peaks Capital Partners™