In this interview, the guest explains why private market investments can dramatically outperform public markets, highlighting the wide performance dispersion among private operators—top firms can double public returns while many underperform or lose money. The core advantage lies in superior due‑diligence and operator selection; consistently picking strong private operators can “kill it.” The discussion then shifts to the 2012 JOBS Act (Reg D 506), which lifted the ban on advertising private offerings to accredited investors, enabling firms to use websites, podcasts, and webinars to reach a broader audience. This regulatory change democratized access but also led to a flood of new sponsors, ranging from highly competent to dishonest, creating a “good, bad, and ugly” landscape that investors must navigate. Despite these opportunities, only about 5 % of accredited investors currently participate in private markets. As a practical first step, the guest recommends reading the book Invest Like a Billionaire, which covers private‑alternative asset classes, portfolio structuring, tax strategies, and the mechanics used by large investors.
Chapters
On the private side, the best operators are doubling the returns of the public guys, double. The worst guys are losing money, right? So they're making 0% returns or negative returns.
Mm-hmm.
And so the way you differentiate yourself, you know, it's almost impossible. People try to beat the public markets all the time and no one can do it really. But in the private markets, you absolutely can beat the market. And the way you beat the market is by doing better due diligence and better underwriting of these private operators. And you can absolutely beat the market. Anyone who does great operator selection consistently in the private market is going to kill it.
Absolutely. That is the foundation of private markets, is the operator. Well, the family office model once was reserved for the ultra-wealthy. What does democratizing that model look like today for high-income professionals?
Yeah, great question. And it used to be prior to 2012, um, companies who were sponsors— and like Aspen, my firm, we sponsor a lot of investments— so when we were raising capital to place it into real estate or into an oil field or whatever, we were only allowed to approach people that we knew. that we had a relationship with. Okay, we're only allowed to do that. And what it does, it means no one could ever advertise or promote. You couldn't have a web page even. Okay, what happened in 2012 is, is that all changed. It's called the JOBS Act, and it made a 506— a Reg D 506 exemption, uh, C— 506 exemption. And what it allowed to do, that as long as companies like us verified That we were talking to accredited investors, and that means you have $1 million in income minus— except for your house, or you have $200,000— sorry, $1 million net worth except for your house, or $200,000 income for the last 2 years, and you expect to do the same this year. If that's an accredited investor, as long as I verify that my investors are accredited, I can advertise, I can have a web page, I can do podcasts, I can do webinars. Well, what's happened is that has opened the doors wide. So now you can find out about these companies. You don't have to just know somebody, right? You can find great operators. And so it's been a proliferation of sponsors and that's good and bad, right? 'Cause there's, you know, the bugs come out, right? And you get the good, the bad, and the ugly. There's a lot of really bad sponsors that are dishonest. You know, there's not that many really, but there's enough, right? That it's a concern.
Yeah.
And then there's just bad operators and plenty of them, but there's also great operators. And it is the way, if you can navigate that minefield, you can be extremely successful.
Yeah, absolutely. And yet there's still, I think it is, there's only about 5% of accredited investors who are actually in private markets even today. And well, I think there's a number of reasons for that but for a successful professional sensing something structurally missing in their portfolio, what is one practical first step towards earning more with less risk through private alternatives?
You know, first step and this sounds self-serving but it's honestly buy the book, Invest Like a Billionaire and read it. It really is the Rich Dad Poor Dad for the millionaire set. And, um, trains you how to, you know, one, how the math works, um, goes through all the different private alts classes, uh, what their superpowers are, how to, how to use them in a portfolio. It goes on how to structure your portfolios, how to, you know, legally how to structure them, how to avoid, how to set up for great tax, how the big boys do this. How do they, how do they, they pay less taxes than everybody? How? I go exactly how they do it, and you can do it too.
