Private Equity Investing Event – Recap


February 5, 2015


On behalf of the PARTNERSINWEALTH team and our sponsors, thank you to the many who participated in this past Tuesday’s event where we discussed private equity investing. The event would not have been a success without the insight of our sponsor representatives: Will Jaco, Statesman Business Advisors; Steven Kesten, BoyarMiller; Howard Rambin, Moody Rambin; Mike Rome, Texan Capital Management; Evan Tierce, MiddletonRaines + Zapata and Jim Waters, PARTNERSINWEALTH.


The conversation was engaging, the information valuable and we all left better informed about this interesting aspect of investing.


To those who were not able to attend, here is a recap of some of what we learned.


What is private equity investing?
It is individuals investing their personal (private) money in exchange for stock or ownership units (equity) in investment opportunities. Investments can range from early stage start-up businesses to well established companies.


What is the minimum amount required to invest in private equity?
It can range from $25,000 to $500,000.


What is the holding period for these types of investments?
3 – 7 years


What level of wealth is recommended before private equity should be considered?
Minimum $2 million of net worth (everything owned less what is owed).


How much investable assets should be placed in private equity investments?
No more than 10-15% of your investable assets. Example: Total wealth equals $2 million. $1 million consists of home and other tangible assets. $1 million is available to invest. Of this amount, no more than $100,000 – $150,000 should be in private equity.


What are the pros and cons compared to stock & bond investments?
Pros- Diversification. Private equity investments often “zig” when stocks “zag” which lowers portfolio volatility. Further, there is a certain confidence that comes from owning “real” businesses that you can touch and feel. Stock and bond assets are often intangible.

Cons- Generally higher risk. Investors often can’t easily sell their ownership interest (illiquid). It takes considerable time and effort to evaluate and investors don’t really know what the true value of the investment is throughout the holding period.


How can I learn more about private equity investing?
Contact PARTNERSINWEALTH or any one of the sponsors listed here. We have well over 100 years of combined experience in all aspects of private equity investing.