Mack Capital is a private equity company. You may have heard the term “private equity” before, considering that private equity firms have a record $1.5 trillion in cash, and there are at least that many trillions invested with these types of firms. While past performance is by no means a guarantee of future returns, private equity companies have historically done well, even compared with other markets. The State Street Private Equity Index posted a 4.35% return for the fourth quarter of 2019 alone, the highest in the past two years.
A private equity company has some unique traits over other investment firms that give the right type of investor key ways to diversify and expand their portfolio.
Provide Investors With Easier Access To Private Equity Markets
When you think of investing, you might think of the stock market, bond market, or maybe even trading options. These are some of the more common investments that people make.
However, there are other investment opportunities in the private sector, as well. Think of real estate, for example. When you look at a tall skyscraper, it’s usually not one person that owns the building. Instead, it’s many people that each has a share in it, like a corporation’s stockholders. These opportunities don’t trade on the stock market, though. They’re private opportunities available to a select group of people.
When you invest with a private equity company, you get access to these investments. Some companies focus on startups, while others focus on real estate. These companies provide investors with a wide variety of investment opportunities not available on the traditional markets.
What Does a Private Equity Company Offer?
Private equity companies typically offer one of three types of investment opportunities:
- private companies (like a VC firm raising capital to invest in a startup)
- real estate (like an apartment building or commercial complex)
- funds (pooled money to invest in a listed objective)
Investors that work with private equity companies usually need to be accredited. That’s an official SEC designation permitting someone to make investments outside of the traditional equity markets. An individual must have an income level exceeding $200,000 for the year ($300,000 if married) or net worth above $1 million. On August 26, 2020, the SEC updated the accredited investor definition to include some other eligibility criteria, but the two rules above will apply to most people.
There is no form that you need to fill out with the SEC, so you won’t get some official letter that you’re accredited. Instead, when you invest in a private equity company, they’ll take your information. As part of that info, they’ll ask for evidence that you are accredited, which you can prove by showing your income or net worth is high enough.
Private Equity Companies Provide Unique Investment Opportunities
At Mack Capital, we have a variety of private equity offerings. We create opportunities using our Mack Funds platform to raise capital and purchase businesses for value opportunities. We work with subject matter experts to build and manage portfolios, and we work with the community by having pitch days to raise capital.
If you’re looking to diversify your portfolio with some different investments, contact us. We’d love to learn more about your situation and provide you with the right investments for your goals.