Michael Sidgmore, co-founder of Broadhaven Ventures, joins our podcast this week to talk about the universe of ‘alts’. By this we mean private markets, not traded on an exchange. We are now seeing some very interesting market structuring innovation in this space, across the lifecycle of the investment.
The growth in private markets has been partly driven because of the sheer number of companies that have chosen not to go onto the public markets. Individual investors still represent a tiny minority of the total investment universe, but now things are starting to change.
Alts are now being made more accessible, and it’s not just about venture capital or private equity either, but other illiquid assets like collectables. Much of this is being driven by innovative technology platforms like Seedrs and Moonfare, helping investors to get access to start ups at very low minimum investments.
Regulation is also starting to make this easier, allowing private investors to participate in crowdfunding schemes. The low minimums now being asked are proving to be a game changer. But even high net worth investors have relatively small amounts in alts compared with allocations to public equities.
Alts have benefited from the prevailing low interest rates, but higher rates may not change this long term trend. Michael tells us on the podcast that he thinks this is going to be a longer term theme, and is already being embraced by younger, under 40 investors who like assets like sports cars, wine and NFTs of course.