Guide to Investing for Business Executives

Everyone has limited time, resources, knowledge, and experience. As a business executive, the majority of our time, along with our resources, has been devoted to our work. Some of us are incredibly efficient with our time and able to multitask multiple simultaneous ventures, but may outsource essential tasks.

Executives like yourself have dedicated the majority of your professional life to solving problems, growing products, services, teams and companies. You’ve proven to be very good at it and are now at a point in your career where you are looking for more. Where many executives direct their attention at this point in their career is investing. You’ve likely done a little investing on your own and may have also seen modest success from those investments. But if you’re looking to see huge returns then it may be time to look to experts in the field.

At this point in your career, you understand the power of delegation and gaining insights from experts within their field. Investing is no different. As experts in our field we wanted to share with you the different ways executives are having their investments managed and placed.

Below are simple yet effective ways that busy executives with limited time work with investment firms to generate high returns.

Executives Start with these Types of Investments

You may have seen incremental growth by putting money into stocks or mutual funds, but to get the big returns and to compound your growth it takes knowledge and time to research the investments that will generate those wins. In our experience, the way most professionals succeed is by working with a firm that can best place their capital to generate the returns they are looking for. But those specific areas of investments can be bucketed into 4 main categories that we go into detail on below.

• Stock Funds -To gain access to additional capital, businesses will offer partial ownership in the form of stocks. When you buy a stock in one of these businesses, you indirectly own a piece of the business though that share. The price of that share can go up and down. The goal is to profit from the movement of these stock shares.
• Index Funds - Index funds are available to investors on the US market and world market. These indexes are considered both conservative and passive investments. Index investing still involves risk, but that risk is lessened due to the makeup of the index itself by combining a number of companies whose performance collectively make up the returns of that fund. Commonly these index funds trend with the market and have shown to go up over time even when the market has taken huge hits it has ultimately rebounded to be higher than it was in the past. This could change in the future but this has yet to be seen.
• Investing in Companies - You can directly invest into companies privately, but in most cases this requires a larger amount of capital, contracts and legal involvement. This can be highly risky with either a big payoff or a big loss expected. Many executives may obtain shares in the company they work for which can be a different class of stock not available to the public that vest based on your contract. While these shares can be a great asset they are less liquid and concentrated solely on the company you work for so there is no diversification.
• Private Equity Investments - Private equity, often known as an alternative asset, allows private or accredited investors as well as institutional investors to diversify their portfolios and take on greater risk in exchange for the possibility of earning larger returns than they would by investing in public corporations. In this case the investor is relying on the firm to make investments in the best interest of its investors and generate the highest return possible.

Executives Are Maximizing Returns With Private Equity

Private equity is one of the best and easiest ways for executives to maximize their investments and generate the best returns over time. It’s a fact that many employees (including executives) are already involved in different types of investments through their workplace 401k, and most executives, particularly those at bigger companies, have corporate stock options. But private equity investments are different in that they frequently outperform public equity investments in terms of returns, including those that you find in 401k plans as well as the performance of the individual company you work for.  The good thing is that private equity investments are not directly subject to market volatility like stocks, funds and 401ks are. As a result, CEOs and executives commonly invest 10-15% of their portfolio in private equity.

At GenX Capital, we employ a leveraged buyout approach to find profitable firms that must be sold for one reason or another. We acquire small to medium-sized profitable and cash-flowing businesses, then leverage our resources, expertise, management, and corporate strategy to quickly drive revenue and profit even higher, including strategically consolidating complementary companies to achieve maximum market value upon exit. Using this lucrative method, we can generate large low-risk returns.  

When you are ready to add private equity to your portfolio, request our executive summary and see what kind of returns you could be getting!