I’m sure you’ve read hundreds of blogs that discuss typical investment strategies. These articles outline the traditional approach to investing that most are familiar with. However, there is a growing trend towards out of the box strategies and creative investing. This type of investing can lead to huge payoffs, require skilled investors to manage, and the ability to go deep into diligence and innovative structuring. Creative investing allows an investor the freedom to explore new markets and provide much-needed capital to otherwise inefficient markets and sectors.
Investing in real estate is actually a rather common strategy for both institutions and individuals. However, most chase assets in big cities when prices continue to increase to irrational levels because they are “familiar” and considered “safe”. A more interesting way to explore the space is to look at assets in less desirable areas on the surface that have room for vast improvement. It’s typically the neighborhoods that are close to these prime locations, but just far enough outside that prices haven’t yet increased proportionally. Think Brooklyn 10-15 years ago. If you are able to buy assets even below market value in these areas and improve them to a higher standard, you are looking at a great opportunity to see both rental income potential as well as asset appreciation over time.
Be an Early Adopter
Most investors will jump on a trend after it has already exploded in the market. Becoming an early adopter is an excellent way to invest. In order to invest in the new big thing, you have to take a chance on a new idea or product, but also you must become an expert in those markets. This way, you will be aware of all associated risk and can provide valuable insights to steer the exciting new product to success.
Creative Ways to Seek Out Opportunities
When it comes to investing, spending meaningful time with people can make a big impact. Consistent networking or dinner meetings lead to better partnerships, meaningful conversation, and less rigid interactions. Most great deals and friendships are discussed over great food and company.
Another way of seeking out the next great investment opportunity is actually letting people come to you. This may seem like a passive way to do so, but if done right, is actually quite the opposite. In order to attract other people, you have to be visible. Having a strong online persona will open you up to new circles of people faster than you’d expect. Don’t get me wrong, it takes a great deal of work, but the payoff can be enormous.
Turn to the Arts
Creative investing would not be complete without investing in creativity. There are a ton of ways to invest the arts, such as becoming a producer on a film or by helping a promising, up and coming artist by providing funding for studio time. No matter how you invest in the arts, you’re helping someone reach to achieve their dreams. This type of investment is not for everyone. In order to see any return, you must have a very disciplined approach around risk mitigation and protecting your principal. Look at investing in the arts like you would any other asset class. Discipline first.