Beyond Stocks

Summary

In this conversation, Chihiro and guest David Kotter delveinto the concept of hybrid debt funds, exploring their structure, benefits, and the unique opportunities they present for accredited investors. David explains how these funds blend traditional debt with equity upside participation, offering developers a simplified capital stack while retaining depreciation benefits. The discussion covers the criteria for borrower selection, the investment structure of the fund, and the associated risks in commercial real estate. David emphasizes the importance of timing and discipline in lending decisions, as well as the focus on specific asset classes. The conversation concludes with insights on future growth and the potential for investors to achieve attractivereturns.

Sound bites

"We take 30 to 35% of the upside economics."

"We project 11 to 13% net IRR for investors."

"Discipline in lending decisions is essential."

Takeaways

Hybrid debt funds offer a blend of debt and equityparticipation.

Developers benefit from simplified capital stacks andretained depreciation.

Borrowers must have a proven track record and financialstability.

Closed-end funds provide stability and predictability forinvestors.

Investors can expect 11-13% net IRR with downsideprotection.

The fund focuses on multifamily, industrial, and strategicretail assets.

Timing and market cycles are critical in commercial realestate investing.

Discipline in lending decisions is essential to avoid marketpitfalls.

Investors should understand the risks associated withcommercial real estate.

The fund aims for growth and future fund offerings.

Chapters

00:00 Introduction to Hybrid Debt Funds

03:05 Understanding the Hybrid Debt Fund Model

06:09 Benefits for Developers and Borrowers

08:57 Criteria for Borrower Selection

11:59 Investment Structure and Fund Details

14:50 Navigating Risks in Commercial Real Estate

18:01 Asset Classes and Market Focus

21:00 Fund Operations and Investor Returns

24:00 Future Plans and Fund Growth

26:54 Philosophical Insights on Market Cycles

Keywords

Hybrid Debt Fund, Commercial Real Estate, InvestmentStrategies, Accredited Investors, Real Estate Financing, Debt Funds, Investment Opportunities, Risk Management, Fund Structure, Market Cycles

Summary

In this episode of Beyond Stocks, host Chihiro Kurokawa interviews Garland Benton from Direct Equity Source, who shares insights into the self-storage investment sector. As with many asset classes, in an industry of this size, not all self storage facilities are the same. Garland's firm specializes in Class-A self storage, meaning newly-built facilities with features like climate control and technology amenities. By contrast, Direct Equity Source doesn't do value-add or conversion projects intended to make improvements to existing facilities.

Their business model involves raising capital for new self-storage developments, and selling those assets to nationally recognized brands such as Public Storage or CubeSmart.

As the capital partner for a developer called AAA, Garland's job is to find investors to help fund these projects.

Takeaways

1. Self-storage is a strong investment sector due to its resilience during economic downturns.
2. Direct Equity Source's model involves significant sponsor investment, aligning interests with investors.
3. The company focuses on building Class A facilities to attract institutional buyers.
4. Investors receive a 12% annual fixed dividend, providing consistent returns.
5. Market saturation is a key risk in the self-storage industry, requiring careful site selection.
6. The fund structure allows for diversification across multiple properties.
7. Garland emphasizes the importance of understanding past performance when evaluating investment opportunities.
8. The company has a strong geographic focus on Texas, with plans for expansion in other states.
9. Investors have liquidity options after a 24-month hold period, unlike traditional syndications.
10. The self-storage market is expected to benefit from reduced new construction in the coming years.

Chapters

02:45 Understanding the Investment Model

05:18 The Resilience of Self-Storage in Economic Downturns

08:27 Diversification and Fund Structure

11:02 Market Dynamics and Consumer Behavior

14:03 Building Class A Facilities1

6:47 Liquidity and Investor Returns

19:25 Risks and Market Saturation

22:19 Geographic Focus and Growth Areas

25:09 Conclusion and Investor Engagementself-storage, real estate investment, private equity, economic resilience, investment model, diversification, market dynamics, liquidity, investor returns, risk management

A conversation with Haroon M. Cheema, a seasoned international tax attorney, discussing the complexities of cross-border taxation, investment structures, and tax incentives. He's done many deals, so he has thoughts on what you should look out for when considering an investment. Haroon shares his journey from New Jersey to Dubai and back, offering valuable insights into the world of international tax law.

Takeaways:

• Investment structures can significantly impact tax outcomes.
• Tax incentives vary greatly by jurisdiction.
• Understanding tax treaties is crucial for international investments.
• Legal and financial expertise is vital in tax planning.
• Tax credits are generally more valuable than deductions.
• Entity structure affects tax liabilities and benefits.
• Due diligence is essential in tax-related transactions.
• AI can assist in finding primary tax sources but not in analysis.
• Tax law is constantly evolving, requiring continuous learning.

In this episode of the Beyond Stocks show, Chihiro Kurokawa interviews Cory Rodriguez, a crypto and Bitcoin mining expert. They discuss the evolution of mining technology, the unique business model of NFN8, and the competitive landscape of Bitcoin mining. Cory explains the risks associated with Bitcoin mining investments and how NFN8 mitigates these risks through strategic power contracts and innovative technologies like immersion mining. The conversation also touches on the finite nature of Bitcoin and the future of mining operations.

NFN8 started in a garage and has evolved into a significant player in Bitcoin mining.

The technology for Bitcoin mining has drastically improved, with hash rates increasing significantly over the years.

NFN8's business model focuses on leasing supercomputers to accredited investors for Bitcoin mining.

Bitcoin mining is primarily focused on Bitcoin, with institutional miners largely avoiding other cryptocurrencies.

The competitive landscape includes both large institutional miners and smaller operations like NFN8.

Bitcoin mining is a finite process, with the last Bitcoin expected to be mined by 2140.

Risks in Bitcoin mining include fluctuating electricity prices and natural disasters.

Emerging technologies like immersion mining are becoming more affordable and efficient for Bitcoin mining operations.

Chapters

00:00 Introduction to Crypto Mining and NFN8

03:58 Evolution of Mining Technology

06:43 Business Model of NFN8

09:49 Bitcoin Mining Landscape

16:21 The Finite Nature of Bitcoin Mining

18:27 Risks and Mitigation Strategies

26:21 Emerging Technologies in Mining

31:56 Investment Opportunities and Closing Thoughts

Bitcoin, crypto mining, NFN8, investment, technology, business model, immersion mining, risks, competition, cryptocurrency

In this conversation, Chihiro interviews James Wang from Mimosa Ventures, exploring his journey into venture capital, the differences between angel investing and venture capital, and the current state of the VC ecosystem. They discuss the impact of AI on various industries, particularly healthcare, and the future of AI technology. James emphasizes the importance of strategic partnerships in investment and the challenges in today's VC market due to economic uncertainties.

Takeaways

James Wang has a diverse background in finance and venture capital.

Understanding the stages of startup funding is crucial for founders.

Angel investing focuses on very early-stage companies, while VCs invest in more established startups.

The VC ecosystem is currently facing challenges due to a lack of exits.

Economic uncertainty affects investment decisions and valuations.

Smaller VCs can find unique opportunities in local markets.

AI is revolutionizing industries but has limitations in reasoning and intelligence.

Practical applications of AI can significantly improve efficiency in healthcare.

The future of AI may involve new business models and payment systems.

Investors should seek strategic partnerships that add value beyond capital.

00:00 Introduction to Venture Capital and James Wang

03:05 Understanding Investment Stages: Seed to Series A

04:28 Angel Investing vs. Venture Capital09:17Current State of the VC Ecosystem

10:57 Market Forces Behind Lack of Exits

12:52 Emerging VCs and the Power Law

14:50 The Impact of AI on Venture Capital

19:20 Limitations and Misconceptions of AI

22:24 The Future of AI and Its Business Models

27:31 Final Thoughts on Venture Capital and AIKeywords: venture capital, angel investing, startup funding, AI impact, investment strategies, market trends, VC ecosystem, seed funding, Series A, technology investments

In this conversation, Pedro De Leon asks Chihiro Kurokawa for the details from his journey in multifamily investments, discussing the reasons behind his choice of this asset class, his first experiences, and the current state of the market. He highlights the challenges faced in today's multifamily landscape, including rent growth and tenant demand, and offers predictions for the future of the market. Chihiro also emphasizes the importance of demographics in investment decisions and shares valuable lessons learned from his experiences in the field.

Takeaways

• Long-term demographics for multifamily are positive due to housing demand.
• Building more housing is essential to address affordability issues.
• Networking and mentorship are crucial for success in multifamily investing.
• The current market shows distress with declining rents and increased supply.
• Investors are experiencing reduced distributions and some have lost equity.
• Future predictions indicate more distress in the multifamily market ahead.
• Chihiro thinks cap rates will expand further before valuations improve.
• Opportunities exist in markets with strong demographic growth.
• Experience is invaluable and cannot be bought
• Choosing the right partners is critical in multifamily investments.

Chapters

03:10 Chihiro's Journey into Multifamily

06:03 Current Market Conditions and Challenges

08:58 Future Predictions for Multifamily Investments

11:45 Identifying Opportunities in Multifamily

14:47 Lessons Learned and Advice for New Investors

17:49 Conclusion and Upcoming Beyond Stocks Workshop in DFW

Keywords

multifamily investments, real estate, market trends, investment strategies, housing demand, economic factors, rental market, property management, investment opportunities, financial distress

In this episode of the Beyond Stocks Podcast, Pedro and Chihiro dive into the world of Private Credit — exploring how it has evolved since the Great Recession of the late 2000s and what investors need to watch out for today.

After 2008, new regulations forced traditional banks to tighten lending standards. This opened the door for private lenders to step in, offering loans to borrowers deemed too risky or undesirable for banks. While private credit has exploded in popularity, it also comes with fewer transparency requirements - leading some to consider it a financial black box. Jamie Dimon recently commented that private credit could be a "recipe for a financial crisis."

Pedro and Chihiro ask the big questions: Could a downturn in private credit trigger systemic risks similar to 2008? Or has the market matured enough to handle stress without collapsing?

Whether you’re new to alternatives or a seasoned investor, this episode will help you understand the opportunities and risks of private credit in today’s market.

• How private credit emerged after the Great Financial Crisis (GFC)

• The similarities and differences between 2008 subprime lending and today’s private credit boom

• Why private credit portfolios can be opaque and difficult to evaluate

• Potential risks if widespread loan deterioration were to occur

• How accredited investors should think about private credit allocation and due diligence

• Learn more about us at www.beyond-stocks.com

  
  

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What You'll Learn

In this episode of the Beyond Stocks Podcast, we sit down with Nic Espanet — multifamily investor, syndicator, and host of the FLEX Forward Podcast. Nic shares his journey from being a passive investor to leading large multifamily syndications, managing thousands of doors, and helping people invest as Limited Partners into commercial real estate.

If you’ve been curious about how to get started in multifamily investing, the challenges syndicators face, or what it takes to scale from a few units to thousands, this conversation is for you.

Whether you’re an accredited investor looking for passive income or an aspiring syndicator aiming to build your own portfolio, Nic’s story and strategies will give you the insights to move forward with confidence.

• How Nic transitioned from passive investor to multifamily syndicator

• The mindset shift required to manage thousands of multifamily units

• What every first-time investor should know before wiring money into a deal

• Key lessons from Nic's journey to becoming a professional investor

• Why building strong partnerships is the cornerstone of success in real estate

• Nic’s perspective on the future of multifamily investing and where the best opportunities may be

  
  

• Connect with Nic Espanet: LinkedIn | FLEX Forward Podcast

• Learn more about Beyond Stocks: beyond-stocks.com

  
  

If you enjoyed this episode, please subscribe to Beyond Stocks, leave us a review, and share it with a friend who’s ready to start investing beyond Wall Street.

Most investors have heard Buffett's expression about being greedy when others are fearful. But knowing it and doing it are entirely different.

John Bullman is the Chief Investment Officer at LGT Financial Advisors, and he has decades of investment experience including 15 years at a leading family office.

This discussion was packed with brilliant insights including John's thoughts on whether we currently have more inflationary or deflationary pressures; a story about how he and his team were rewarded for having the guts to go big after being clobbered (along with everybody else) during the Great Recession.

Beyond Stocks is the premier podcast and community for people who want to go beyond stocks, bonds and mutual funds to invest in alternative assets. It's time to get out from under Wall Street!

Jared Benson with Clotine Capital is our favorite kind of investor. He started with a regular job like most other people, but at the young age of 25 he made his first investment into a private offering. He's also tried his hand in multiple businesses as an entrepreneur but wisely concluded that he should only create and run businesses that are in his area of expertise. This mindset allowed him to reach accredited investor status at a young age.

Today, he's focused on making his money grow for him through a variety of private investments.

Jared also discusses good and bad deals and the lessons learned.