This paper introduces “The Lane” – a fundamentals-based investor guide for identifying and better understanding the basic elements of a business, and, it follows, whether an investment in that company is a better private investment alternative. Applying the Lane’s simple framework to investment analysis and due diligence helps organize what is, arguably, the most demanding More >
With the pundits betting that the U.S. economy is headed for a recession, commercial real estate (CRE) is expected to suffer – but it is also likely to bounce back faster than other investment sectors. Nevertheless, over the last 20 years through market cycles, CRE has generated an average annual return roughly of 9.5%, higher More >
The low interest rates offered from U.S. Treasury and public bond markets are increasing private lending among investors looking for greater returns on their fixed-income investments. At the same time, smaller companies (SMB’s) must turn to other financing sources to fill the void left by commercial banks who have largely retreated from SMB lending. Credit More >
After decades of evaluating, financing, supporting and tracking direct private investments (DPI), I find it amusing when someone suggests that their deal was “destined to be a success.” Investing success is never assured. In the following white paper, I’ve distilled DPI investment decisions down to the 5 most fundamental factors to screen for in a More >
Since 2015, the number of, and wealth represented by, family offices have grown dramatically. So, too, have their levels of sophistication and professionalism matured. In the process, their investment strategies, adding direct private investments (DPI) to the portfolio mix, and organizational models have significantly evolved to meet their long-term goals. Co-investing with another family office, More >
With some of the world’s greatest wealth being created within the beauty industry, direct private investors should consider adding beauty to their portfolios. Beauty offers: its inherent product characteristics (e.g., high gross margins, repeat purchase patterns, brand loyalty); an effective means of marketing via social media; a growing middle class worldwide with More >
Direct private investing is challenging. It requires a commitment to learning and an organized, thoughtful approach. Carofin’s Knowledge Base contains comprehensive resources to guide private investors that fall into three tracks: Personal Considerations – Self-evaluation for suitability as well as investment portfolio management; Issuer Evaluation – Corporate analysis and due diligence; and Security Analysis – More >
If considering private investments, investors should understand the types of securities most often issued in debt and equity private placements. This paper highlights three aspects: what each type of security represents as an obligation of its Issuer; what this means for investors; and how each is structured to perform for the investor. Fundamental financial concepts More >
Thorough investment analysis should be preceded by an abbreviated process described in the “Five Elements.” Once this framework is understood, a private investor can determine whether a more in-depth and time-consuming investigation is warranted. The five elements that influence an investment’s structure include: 1. Purpose – Why is this capital being raised? 2. Issuer – More >
With over $3 trillion in the private investment market, accredited investors have a wide variety of alternative investments from which to choose. When selected properly, these securities can provide an attractive complement to more traditional investment portfolios. However, to consistently achieve the best investment performance, it is important that three things are in alignment: Right More >
It is difficult for Angel and other individual investors to determine whether the investment returns offered through a given private placement are fair. This White Paper reviews ranges of investment yields (Return on investment or “ROI”) appropriate for various types of direct private investment in operating companies, including private debt, venture capital and private equity. The More >
Alternative investments are now easier to find for individual investors, but crowdfunding websites often fail to incorporate two cornerstones of private investing: Accreditation and Suitability. Crowdfunding portals typically rely on the investors' ability to self-select deals that may or may not be appropriate for them. Carofin strives to ensure in its private placement offerings that More >
Nine “Leaps of Faith” are identified to quickly evaluate and contrast venture-stage equity investments (“venture capital” investments). They include: Has the entrepreneur launched a start-up before? Is the company’s product or service simply an improvement to existing practices or a disruptive technology? Do they have a product? More >
Where do investors start in their private investment analysis ... even before conducting due diligence? At the most basic level -- First Principles, "the first basis from which a thing is known." First credited to Aristotle and commonly applied in scientific analysis, First Principles is an approach for identifying the most fundamental considerations when evaluating More >
Fast-growing private companies in need of capital have an alternative to traditional debt or equity financing -- revenue royalty-based financing. Revenue royalty notes afford the private investor the opportunity to collect current income with a return on investment (ROI) that can be comparable to private equity. Unlike distributions from private equity investments, payments received from Royalty Notes are not tied to More >
Attractive investment returns are possible through private lending, but preparation, proper loan structuring and ongoing monitoring are essential to protecting your invested capital. This White Paper offers a three-step process: 1) Get to know the Issuer’s management well and conduct a thorough credit analysis and due diligence review of the Issuer; 2) Structure the investment, More >
A framework for an initial and quick investment analysis, Carofin has identified “Seven Questions” to efficiently guide a prospective private investor to a basic, but more comprehensive understanding of an operating company. While not exhaustive, addressing these seven questions provides a solid foundation from which to conduct more detailed due diligence. The Seven Questions are: More >
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