Research is Key to Sound Private Investing

November 4, 2022

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Some of the private investing research we do has been over the span of 40 years in our shop alone and we continually use the research conducted by my fathers’ management practice which dates back to the 1920’s. My mentor purchased his first public stock in 1926 and drilled his first oil well in the mid-1930’s.

In our world of due diligence, we use the Mosaic Theory of investment analysis. We take all the information from every source we can acquire (both good and bad) and merge it together to create a matrix for decision-making about our specific niche opportunity.

Generally, we work from the broad picture down (top) to the specific platform we are researching (bottom). As part of the process, we use different and similar asset classes to determine the expectations we should set.

This helps us determine the most accurate returns that we can expect. For example, we like the Self-Storage business because it generally generates the greatest returns with the least amount of management and the least amount of risk in the marketplace. 

Our first exposure to the self-storage business was during the late 1970s when we were offered the purchase of several storage facilities. That program never materialized for us, but during our due diligence, we learned an exceptional amount about all levels of the storage business, pitfalls, management techniques, and the economics.

It was a valuable learning experience that has served my team well. We have used our experience in the storage business to the benefit of our partners several times over the past two decades.

We still consider it the most profitable sector of the commercial real estate business with the least amount of risk in North America.

Private investing research is our bread and butter and it’s why we have had the success we do. At Custom Private Equity, we stick to what we know — and that’s how to protect wealth from inflation and economic hardship. If you need help navigating these murky market waters, call us at (325) 695-1329 or contact us here.

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