In the vast landscape of investment opportunities, the quest for the next game-changing unicorn continues. However, amidst the bustling hunt for digital prowess, there lies an untapped realm teeming with immense potential—the realm of US advanced industries.
The Untouched Goldmine
For over a century, advanced industries have quietly thrived, playing a pivotal role in the US economic ecosystem while safeguarding national security. Yet, their potential remains vastly underexplored due to historically low levels of investment during our lifetime. This underinvestment sets the stage for unprecedented opportunities for discerning investors.
Navigating Uncharted Territories
The spotlight of the past decade falls on software unicorns, leaving the hardware sphere in relative obscurity. However, it's this very distinction that makes hardware and infrastructure investments a hidden gem. Investments in to heavy-duty transportation power and equipment, transport infrastructure, and advanced power technologies, while capital-intensive, offer a realm with less competition, fostering robust, stable returns—a stark contrast to the oversaturated software market.
Exclusive Access to the Elusive
Venturing into US advanced industries isn't merely about investing—it's about gaining entry to a domain shrouded in exclusivity. Deals here are elusive, tucked away within private family offices and oil & gas entities that have long held sway in this sector. This offers a unique proposition for astute, informed individual investors.
The Resilient Portfolio: Minimizing Competitive Risk
Investments in advanced industries come with a unique advantage: reduced competitive risk. With less market saturation and competition, portfolio companies within this sector stand resilient against the turbulent tides of market rivalry, presenting a cushioned environment for investors.
Riding the Wave of Energy Transition
The pressing need for innovation in energy transition technologies is undeniable, especially within heavy-duty transportation networks such as rail, marine, and trucking. This is where the true potential of US advanced industries shines—an arena ripe for transformation, poised for exponential growth in the coming years.
Seizing the Moment
Economic forecasts unanimously predict an unprecedented surge in innovation in this sector over the next three decades. The transition of industrial fleets toward cleaner power sources is not just a trend but a seismic shift. Surprisingly, very few venture capital firms are attuned to this imminent wave, making now the golden opportunity for individual investors to access the earliest and most lucrative stages of capital investment in this colossal sector.
Conclusion: Embracing the Future
Investing in US advanced industries isn't just about financial gain; it's about being a part of shaping the future. It's about harnessing innovations that drive economic growth while championing sustainability. The time is now—seize this moment, delve into this uncharted territory, and be at the forefront of pioneering change and reaping rewards.
About the Author:
I am a private investor that makes strategic investments into private companies. I am not a fund, a registered investment advisor, or a broker/dealer. I have a lot of experience in business and investment strategy. Discussing startups, investment strategy, and tax structures over dinner with friends (old & new) is one of my favorite pasttimes. I love meeting new people and introducing them to venture capital. Over the years, I learned how to access these types of investments. I then hired a good lawyer to help me properly structure them. Soon, I had many friends, family members, and colleagues begin asking to invest alongside me.
In addition to making personal investments, I have developed a simple structure that provides other individual investors the ability to invest alongside me on any deal. Each investment is structured as an independent limited partnership (LP) into a single portfolio company, managed by a general partner (GP). When possible, I set up tax-advantaged structures. If you are an individual investor or couple interested in making investments between $25,000 and $250,000, I am happy to introduce you to how the industry works and include you in the investments you have an interest in participating in.
Structure & Disclosures:
Documents and filings are prepared by a law firm that specializes in securities law and private investments. Tax and accounting is managed by a boutique firm that specializes in investment accounting and fund management. Fees are efficient as I use the same structure and legal/tax partners for each investment. General partner carried interest is performance based (begins at 10%) and not the 20% flat-rate standard. Management fees average less than the industry-standard of 2% per year. Tax advantaged structures I have experience in include (a) investments into companies eligible to issue qualified small business stock (QSBS), which, with a 5-year hold, can yield a 50% capital gain exclusion, (b) investments into qualified opportunity zone businesses (QOZB) through a qualified opportunity fund (QOF), which enable me to defer current year capital gains and offset up to 100% of the gain from the investment (requires 10-year hold), and (c) investments through a self-directed IRA.