I’m looking at investment a portion of my portfolio into alternative investments. Maybe around $30k to start. Anyone have recommendations or experience with Alt investment vehicles? (e.g., crowdfunded startups/real estate, PE, VC ETFs)??

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You might not be familiar with the old joke “A limited partnership is where, at the beginning, the limited partners have the money and the general partners have the experience. At the end, the general partners have the money and the limited partners have the experience.”

This can be applied to most alt investments. If you don’t understand the details of a lightly traded asset, be prepared to get some experience.

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$30k won’t get you very far in the alt investment space.

By regulation, most security issuers in the private markets are limited to a few hundred outside investors before they have to begin reporting to the SEC (not an expert here, so I don’t know the details). The implication is that minimum buy-ins can be at least six or seven figures. You also want diversification so having more than on investment is a food idea.

A few alternative approaches to get exposure:
1) Invest in the publicly traded investment firms that have large PE businesses

2) There’s an emerging type of VC/PE fund aimed at the mass affluent where buy ins to the fund are in the $30-50k range - you do need to be an accredited investor

3) There are a number of websites that offer access to start up financing - I’ve never participated in these so can’t comment further

4) I’ve participated in a couple syndicates where a group of 10-12 investors form a shell company to pool our money and buy in. It does require you to be an accredited investor. There is a start up cost of a few thousand dollars and then the group pays a little for tax reporting. One investment went bankrupt and equity holders were diluted 80% - that may still play out since I was basically part of Series B.

5) In the not too distance future we’ll start seeing more secondary markets and tokenization of closely held companies. There’s a big push on this as employees and early investors need ways to monetize their positions since going public tends to take longer. Will likely still require being an accredited investor, but should offer additional opportunities.

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Alumni Venture Fund is fairly active in their marketing. Haven’t heard their pitch. I’m sure you can search for others.

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Check out Startengine. Crowdfunding site but lets you invest in startups with as less as a $100. Pretty interesting.

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