A little over a year ago, I was in the final stages of setting up a new kind of investing service. The goal of that service was to introduce retail investors like you to the most profitable markets in the world.
Where Have All the Flowers Profits Gone?
You see, over the past few decades, the returns investors could get out of the stock market had shrunk. Yet the amount of money raised by companies and the overall profits made by investors had grown.
There was a growing disconnect between overall profits and those available to regular investors, and that’s because all the real gains, the massive profits, were being taken before companies even hit the public markets and became investible.
All of the real money was being made in the private markets, which were, by design, exclusively available to the super-wealthy and well-connected.
But there’d been a recent development in the form of an act of Congress. It opened the doors of the private markets to every investor who wanted a piece of the action.
But private investing is very different from public investing. When you’re buying stocks on the market, you have equal access to all the information about those stocks.
More Risk Work for More Reward
When you’re investing in a private company, though, you can’t just search for a ticker symbol on Yahoo! Finance and check out years’ worth of balance sheets and income statements.
And that’s because private companies don’t have to follow the same rules as those listed on public markets. They don’t have to submit audited financials to the SEC every quarter. They don’t even have to tell their investors what’s going on if they don’t want to.
That makes choosing the right private investment a lot more complicated than choosing the right stock investment.
Since you can’t just go out and look up the company online or in some database, you’ve got to do a lot more homework.
You have to learn about the team behind the company. Have they successfully started and run a business before? Have they created value for shareholders in the past? Do they seem trustworthy?
These are all questions you probably don’t ask about an established publicly traded company before buying its stock on an exchange. But they’re questions you have to ask if you’re going to invest in a private company.
You have to learn about the product or service it’s offering (or hopes to offer). Is it innovative? Does it solve an existing problem or make an existing technology even better? Is there a market for such a product or service, and how big is that market?
You have to find out if the company has any way of protecting itself from the competition. Since it’s private, it’s likely still small. So how could it fend off the attack of a much larger firm with more money to throw around?
Does the company have patented technology? Does it have protected intellectual property? If not, has it applied for patents and other IP protection? And how long has it taken to develop its product or service — a long path to completion is sometimes enough to keep you that one important step ahead of the pack.
Those are just some of the things you need to determine before making an investment in a private company. It requires a lot of extra effort.
But if you put in the work, the rewards can be exponentially better than those you’ll get investing in regular old stocks like everyone else.
Private Prosperity vs. Public Profits
A few recent examples spring to mind when thinking about the difference between the money made by private investors compared to what stock investors make.
In fact, 2020 was rank with private investors achieving prosperity while public investors just booked a little profit.
Two really stick out in my head, probably because they were two of the last to go public in 2020.
First off is DoorDash. The company listed its shares on the NYSE on December 9 at a price of $102 apiece. But the shares didn’t start trading on the public markets until they’d already hit $182 each.
That gave the company an overall valuation of over $60 billion, and the investors who bought in before the IPO made out like bandits…
The final private funding round happened last June. It valued the company at $16 billion. So when the shares debuted on the NYSE, those investors were looking at a 275% gain on their investment.
And those were the last investors to get in on the private side. So you know that they paid the highest price of all the private investors. Yet they still made a cool 275% as soon as the stock started trading.
Go back to when DoorDash was a smaller private company in 2016 and 2015, and you’ll see how the private profits really create prosperity. Those investors came in at valuations of $700 million and $600 million, respectively.
And they walked with profits of 8,741% and 9,900%, respectively. Those weren’t even the earliest investors!
The terms they got were never made public (as is the right of private companies), but you can bet they walked with far more than the 9,900% those investors from 2015 made.
But that’s not the whole of my point. You see, before the shares had even started trading, these investors were cashing out massive wins. The people who bought those shares in the IPO didn’t make out all that well at all, however.
After hitting a peak of $195.50 per share, that stock has done nothing but fall. So most of the investors who bought the public shares on the open market are sitting on a loss.
Private investors won while public investors lost.
And that’s not even the best example. In fact, it’s not even the best example from last December. That honor goes to Airbnb…
How to Turn $1,000 into $19 Million
You’ve probably already heard me mention this, but I’m going to mention it again because it bears repeating.
When Airbnb went public on that same day, December 9, its earliest investors cashed out a 1,879,900% profit. Let me say that again:
A 1,879,900% PROFIT!!
That’s enough to turn every $1,000 into nearly $19 million!
That’s because the earliest investors bought Airbnb as a private company with a $2.5 million valuation. By the time it listed on the Nasdaq about 12 years later, it was valued at $47 billion.
Every single person who invested in Airbnb while it was a private company walked with at least a 50% gain — that includes the folks who got in right before COVID-19 threw a monkey wrench into Airbnb’s whole business model.
But how about the folks who bought into the hype and picked up IPO shares on the public market?
Well, if they’ve held onto the shares, they’re only down 3%. That’s not as bad as the DoorDash IPO buyers, but it’s a far cry from the Airbnb IPO sellers.
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Coming Full Circle
And that brings me back to where I started this piece: about a year ago when I was finalizing all the details and getting ready to launch a new investing service.
In a fortuitous bit of timing, just as I was ready to start sharing these kinds of investments, a great one came across my desk. So I made it the very first investment for my new service, Main Street Ventures.
I even shared it with you here in the pages of Wealth Daily and gave you what I assume was your very first opportunity to invest in a company before it went public.
The company was Juva Life, and the opportunity was to invest in it at a valuation of $80 million while it was still a private company. We would get shares for $0.50 each and we would also get warrants (the option to buy more shares at a future date and a fixed price) for $0.75.
We were the last investors to get in before the company closed private funding and started to file the paperwork to go public through an IPO, so we got the highest private price.
But, when the company made its stock market debut, those shares we’d bought for $0.50 started trading for $0.80. And they shot up to $1 in short order.
Within just a few minutes of trading, we’d already doubled our private investment. But I see far more in the future for this company, so we haven’t sold our shares just yet.
And now we’re looking at a 152% profit.
Now, obviously, you can’t invest in Juva’s private rounds anymore because it’s a public company. But you can still buy those shares on the public markets.
And I recommend you do if you’ve got a speculative account.
The company is currently a standard cannabis operation — growing, processing, and selling it — but its plans for the future are different from any cannabis company I’ve ever seen.
From Retail & Delivery to Research & Development
Juva’s goal is to use its retail cannabis operation to fund research and development of new cannabis-based medicines and therapies.
Through its retail operations, it has access to countless adult cannabis users. And thanks to that relationship, it has access to loads of data on how they use cannabis and what they use it for.
The company plans to use that data and those patient/consumer relationships to facilitate more in-depth research into the medical benefits of cannabis and the chemicals found in the plant.
If it’s successful in achieving that goal, it could become an extremely valuable partner for pharmaceutical companies interested in cannabis research but hoping to avoid all the red tape that federal regulations still bring.
It could become the de facto research and development company for a pharmaceutical industry completely based on cannabis and cannabinoids (the chemicals in the plant).
Right now, the company trades on the CNQ exchange in Canada under the symbol JUVA. Those shares are going for about CAD$1.22.
It also has OTC-listed shares that trade here in the U.S. That ticker is JUVAF and the going rate is about $1.
With its current operations, the stock is worth $2 to $3, so it still has some runway even if it just stays a retail cannabis company.
But if it keeps making progress towards that end goal, this will be a multibillion-dollar company. And a 10x return from today’s prices isn’t out of the question.
Just for reference, 10x gains from here would give my private investors an overall gain of 2,340%.
And if 1,000% sounds good, but 2,340% sounds better, I’ve got an opportunity for you to join my private-investing community so you can cash out on the next big IPO too.
Your Invitation to the VIP Section
I started Main Street Ventures in part so that everyone could get access to the lucrative private markets. But another defining reason for my desire to launch such a service was to help people navigate a new and often confusing market.
You already know that private companies don’t have to follow the same rules as public ones. They don’t have to report earnings or losses. They don’t have to tell you about assets and liabilities. That’s all up to you to find out.
And they’re not easy to research because they don’t post all of that information publicly. So it’s a lot of work to even find these companies, let alone vet them to make sure they’re the real deal.
But I’ve been doing just that for myself for years, and it’s not that much extra work for me to do it for you too.
That’s the real value behind a membership to Main Street Ventures. Sure, you’re getting access to the most lucrative market in the history of the world, but you’re also getting me.
I bring years of experience working on Wall Street and with my own private clients. I bring a network of company founders, venture capitalists, and serial entrepreneurs with me too.
So while other investors are struggling to find companies to research, I’m getting deals brought right to me by a vast network of industry connections I’ve spent decades building.
With each company my investors and I help to capitalize, our reputation as savvy investors grows and more companies want to work with us.
And that growth is really starting to compound. We’re getting some of the best investment opportunities I’ve ever seen, and they’re coming fast.
We’ve invested in one new private deal every month since October, and I’ve got several promising ones on my desk as I type this article.
I expect we’ll be funding those companies this month. And like all our investments, I see a ton of potential for growth and gains.
Start Changing Your Life TODAY
So if you’re interested in getting in before the next blockbuster IPO…
If you’re tired of taking the short end of the stick and giving the lion’s share of the profits to others…
If you want to get in on the most lucrative market in history, now’s your chance.
I’ve reserved some spots at Main Street Ventures just for those of you who read my Wealth Daily articles.
Now, these spots are pretty highly coveted, so I can’t keep them open very long. But in the hopes of convincing you to act quickly and join us before I have to give your spot to someone else, I’m offering an incredibly generous discount for membership.
You’ll pay less than you would for a DoorDash delivery for four, and you’ll get access to the kinds of deals that let Airbnb’s investors turn a grand into a fortune.
So, click here now to see how you can join us and get started investing in the private markets TODAY.
To your wealth,
After graduating Cum Laude in finance and economics, Jason designed and analyzed complex projects for the U.S. Army. He made the jump to the private sector as an investment banking analyst at Morgan Stanley, where he eventually led his own team responsible for billions of dollars in daily trading. Jason left Wall Street to found his own investment office and now shares the strategies he used and the network he built with you. Jason is the founder of Main Street Ventures, a pre-IPO investment newsletter; the founder of Future Giants, a nano cap investing service; the editor of Alpha Profit Machine, an algorithmic trading service designed specifically for retail investors; and authors The Wealth Advisory income stock newsletter. He is also the managing editor of Wealth Daily. To learn more about Jason, click here.