
Ask HN: Pulling all $ out of public equities. Interesting private alternatives? - elamje
Not one to ask questions like, “what stock to buy?”.<p>I thought I could get some useful insight here and help others by asking people for interesting private investments they have been part of, or have seen.<p>I’m pulling all of my money out of public equities for the next few years (except my tax advantaged accounts). My goal is to do something interesting, e.g. small private equity, investing in social media accounts, small angel investing, etc. It can be passive or active, equity or debt based. I’m interested in it all.<p>Essentially, I find this period of time fascinating because rates and returns in public markets seem to be below private markets, and I’d like to focus my energy doing interesting things there, rather than buying index funds etc.<p>Feel free to hit me on Twitter @elamje or email johne@hey.com as well.<p>What are some really interesting investments you have heard of that are unique?
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deanmoriarty
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.

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elamje
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.

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baccredited
With a few hundred thousand to invest I'd probably do a 3-way split between:

[https://www.thesyndicate.com/](https://www.thesyndicate.com/) \- back Jason's
next 50 deals at 2K each

Put 25K each into the next 4 YCombinator deals at
[https://fundersclub.com/](https://fundersclub.com/)

Put 50K in the next 2 quarters at AngelList Access Funds
[https://angel.co/v/access-fund](https://angel.co/v/access-fund)

If you do any of this give me a follow at @baccredited and let me know how it
goes. I just followed you as well.

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baccredited
To clarify on the FundersClub recommendation: don't do individual YC company
deals, do the rollup funds like this:

Accelerate FC XIX: Y Combinator W18 Fund targeting investments in ~10-15 top
startups in the Y Combinator Winter 2018 Batch.

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Bostonian
'I’m pulling all of my money out of public equities for the next few years
(except my tax advantaged accounts).'

To avoid paying taxes on realized capital gains, you should be selling stocks
in your tax-advantaged accounts, not your taxable ones.

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elamje
Thanks for the advice. You may be misunderstanding my position as it’s more
tax efficient for me to do as I mentioned above.

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marketgod
Why do you think that the public markets are a bad investment right now? The
public markets are a stock pickers market right now, so something like TSLA is
going to outperform a lot of different investment options over the next
5-years.

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elamje
I can’t tell you if they are or aren’t a bad investment. I am just confident
in the level of returns I could get in private investments, and it seems to be
better than what I can do in public.

Invest in TSLA as much as you like. I’m going to be investing in things with a
lot less 20 somethings invested in it.

~~~
marketgod
Thanks. I was really curious as to people with larger capital available and
how they are rotating their money. In the last 3-months, I have had more
private investors reach out to me with respect to allocating their capital and
increasing returns while bypassing the traditional capital markets.

