In this Article:
- Where will all these unicorns come from?
- Renewables Will Heat up in 2022
- Invest Like a Wall Street Titan on a Main Street Budget
Earlier this week, I told you the stock sell-off we’re seeing today is setting off a boom in private markets.
According to Fortune, more than 80% of venture capital and private equity firms say they plan to raise capital in 2022. That’s up from 75% in 2021.
And the amount of money they’re raising is increasing. In 2021, private equity funds raised at least $733 billion globally, surpassing every previous year on record.
This year, they’re forecast to raise $952 billion.
The rush from the public markets into the private markets makes sense for these Big Money players when you consider private companies also have lower volatility than publicly traded companies… and perform better during challenging times.
In 2021, the pace of new unicorns (a private company that reaches a $1 billion valuation) increased considerably, reaching an average of two new unicorns minted per day. And I expect that activity to increase this year.
That begs the question: Where will all these unicorns come from?
The answer is: Clean energy.
Now, I’m a capitalist. So I don’t look at investment ideas just because they make us feel good. But regardless of what you think about “clean energy,” it’s the hottest investment trend in the United States right now.
Renewables Will Heat up in 2022
Before any bias you might have about “clean energy” comes rushing out, let me be clear…
Today’s clean energy industry is different.
The smartest minds in technology are working in it… and the smartest minds in finance are investing in it.
Larry Fink is the CEO of Blackrock, the largest asset manager in the world with $10 trillion in assets under management.
Here’s an excerpt from his annual letter published in January 2022:
The next 1,000 unicorns won’t be search engines or social media companies, they’ll be sustainable, scalable innovators – startups that help the world decarbonize and make the energy transition affordable for all consumers.
Think about that.
Fink is one of the wealthiest, most well-connected men on the planet. He’s not some starry-eyed kid or a tree hugger who wants to “change the world.” This is one of the most influential money men on the planet.
He goes to bed thinking about money. And he wakes up thinking about money.
And he knows there is a stadium-sized stack of money to be made in clean energy technology.
According to Allied Market Research, the 2020 value of renewable energy was $881 billion… and projected to reach nearly $2 trillion by 2030.
Renewable stocks are outperforming the broader market, returning approximately 159% since the end of 2019 compared to the S&P 500’s 29% within the same span.
But it’s in the private market where you stand to make the biggest gains from the clean energy trend.
Take the electric vehicle (EV) battery tech company, QuantumScape, for example. Famed investor Jeremy Grantham invested $12.5 million in the company while it was private. QuantumScape went public in 2020 via a SPAC merger… and his stake swelled to $638 million before the year was up.
That’s a 5,005% return. That far outweighs the potential 719% gain the average investor could’ve hoped to make by buying into QuantumScape when it announced its SPAC merger.
Here’s another example. In 2017, Saudi businessman Abdul Latif Jameel stumbled upon on the EV startup named Rivian. He made several private investments in the company at an estimated valuation between $1–2 billion.
Rivian went public in November 2021 at an $83 billion valuation… netting potential returns between roughly 4,000–8,000%. Within weeks of the IPO, Abdul was sitting on a potential return of 14,900%… enough to turn every $1,000 invested into $150,000.
Meanwhile, regular investors that got in on IPO day saw peak gains of 80%… enough to turn $1,000 into $1,800.
As you can see, investing in clean energy companies before they become public is how you can potentially move the needle on your financial life without putting your current lifestyle at risk.
But if you didn’t know the wealthy insiders behind these deals like Grantham or Jameel did, you wouldn’t have been able to invest in them. So I’ve made it my mission to change that.
Invest Like a Wall Street Titan on a Main Street Budget
Ever since my early days on Wall Street, it’s driven me crazy. As a retail investor, you couldn’t access the private market. Legally, there wasn’t any way to get into these deals.
Finally, the SEC has cut through the red tape allowing the public to get in.
But cutting the red tape doesn’t mean Wall Street will say, “Come on in!”
They’re not going to welcome you like a long-lost brother… or roll out the red carpet and kiss you on both cheeks.
The best deals are still only found in one place. And that’s on the “inside” of the market.
To find these deals, you’ve got to move in the right circles of venture capitalists, billionaires, and influential deal makers. That’s where you find the best deals.
The good news is – and it’s going to sound like I’m bragging, but I promise you I’m not – I’m fortunate enough to be in that position.
I’ve gone to those events. I know many of the billionaires in the early investing space. I’ve been on their private jets, attended their private parties, and am on a first-name basis with many of the top dealmakers operating in the market today.
And recently, I’ve uncovered what I believe could be the next unicorn in the clean energy space.
This company in the American heartland says it’s found a way to produce environmentally friendly oil without drilling or fracking.
After vetting it, Wall Street powerhouse JPMorgan cut a check to be its largest shareholder… I’m talking about the biggest bank in the United States.
JPMorgan is behind some of the biggest private deals, including Facebook, Tesla, and EV maker Rivian. And some of its deals have returned 47x, 100x, and 159x.
That last one is enough to turn $1,000 into $160,000.
And remember… Regardless of what you think about clean energy, it’s the hottest investment trend in the U.S. right now.
Avoiding those investments because of personal bias only hurts your financial future.
JPMorgan will still be this company’s largest shareholder… and it’ll still cash out its shares for bigger gains than investors who bought too late… or didn’t buy at all.
Which side of that trade will you be on?
Let the Game Come to You!
Editor, Palm Beach Daily