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Private equity has often been dominated by institutional investors and family offices, but some new offerings are providing increased accessibility to the space.
Kelly Ann Winget, founder of Alternative Wealth Partners, joins the show to discuss non-correlated private equity strategies, and how these strategies can help “everyday” accredited investors reach their investment goals.
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- Details on Kelly’s background in the private equity, and why she decided to launch her own fund.
- The three asset classes that Alternative Wealth Partners is focused on (and why these specific asset classes offer the prospect of above-average returns).
- The tax advantages of oil and gas investments.
- A surprising reason why manufacturing business may be poised for higher-than-expected growth.
- A sneak preview of two upcoming offerings from Alternative Wealth Partners.
Featured On This Episode
- Press Features & Releases (Alternative Wealth Partners)
Today’s Guest: Kelly Ann Winget, Alternative Wealth Partners
- Alternative Wealth Partners – Official Website
- Alternative Wealth Partners on LinkedIn
- Kelly Ann Winget on LinkedIn
About The Alternative Investment Podcast
The Alternative Investment Podcast covers new trends in the alternate investment landscape. Hosts Jimmy Atkinson and Andy Hagans discuss tax-advantaged investment strategies to help you grow your wealth.
Andy Hagans: Welcome to the Alternative Investment podcast, I am your host Andy Hagan’s and today we’re going to be talking about diversified private equity strategy something very unique a very unique strategy brought to you by Kelly Ann Widget, who is here with me today on the show. Kelly, welcome to the show.
Kelly Ann Winget: Thanks for having me Andy i’m excited to talk about everything.
Andy Hagans: Yeah and we had just a little mini conversation before we hit the record button.
And you know Kelly, you were telling me about your background and how you got in to the private equity space, and I really think that’s a big part of what makes your fund interesting, so why don’t we just begin there could you tell us you know how you got into this world of private equity.
Kelly Ann Winget: Sure, so it kind of started from the beginning of time. I’m five generations in oil and gas so i’ve always been exposed to at least that industry, but both my parents were in financial services.
My father worked for PricewaterhouseCoopers for 30 years my mother has been an accountant for several different privately owned companies, including two different oil companies.
So it was just a space that I was involved in, or at least had knowledge of my entire upbringing, but eventually I found my own way into oil and gas, which was kind of my intro into the private investment space.
In that industry through that experience I eventually went into kind of the investor relations role for different companies raising capital over the last several years.
A few years ago I worked with a family office. That branched into a private equity company, they were trying to raise capital from retail investors to individual investors, and so I kind of bridge the gap between individual high net worth investors terminology and understanding to the institutional space.
Just to make sure that investors were understanding what they were investing in but there was a lot of lack of transparency in that world.
That I just didn’t like and so with that combined experience, I decided to launch alternative wealth partners and start working on a diversified fun for the individual investor.
Andy Hagans: Okay now you don’t need to say anything more than you’re comfortable with.
But I guess from someone operate on the inside and interacting with institutional investors or family offices versus your everyday retail accredited investor I’m curious your take on like the relative sophistication is the wrong word but almost like street smarts or investment skill, have a retail investor versus institutional investor, because on the one hand, you know when I speak with institutional investors they’re they’re more sophisticated they have more time and bandwidth.
You know, to to research different investments segments, but on the other hand, I feel like a lot of times when it comes to investment selection, they still end up flipping a coin.
or placing you know, placing the investment with with the woman they had a beer with of the guy they had a beer with at the last conference or whatever it’s so it’s not really any different at the end of the day.
What is your take the you do you think the institutional investors like that kind of scenario.
Where you know, like a family office or private equity firm starts to accept retail investors do you feel like you’re dealing with a less sophisticated investor or is it just they just different.
Kelly Ann Winget: know they they just have different goals, so their investment, like the reasons why they’re making the investment are very different, and I think it’s hard for somebody who is already worth dollars to communicate with somebody who isn’t worth a billion dollars.
Andy Hagans: Literally oblivion or.
Kelly Ann Winget: yeah yeah like their risk tolerances are very different right.
You can be worth a few million dollars, but still be worried about you know if this investment goes bad it could drastically affect my retirement or my family’s well being.
And the billionaire can make a million dollar investment and it literally would change nothing about their lifestyle.
And it’s that disconnect that happens kind of in the family office private equity space, because they deal with a lot of really big numbers.
yeah and the people that I like to work with are.
You know, typically small business owners or like retired pilots.
You know, even a plumber makes three $400,000 a year if they own their company so you’re dealing with people that in.
in money terms, make a lot of money, but in their world is not a lot of money.
understanding that is really important, I think that when you are so involved in the finance space you can’t disconnect from that like you understand it, because you spent all day looking at numbers you’re you’re doing the analysis you’re looking at the deals.
And it makes sense to you, but somebody who has a day to day job like a pilot they know planes or a doctor who knows bones like they don’t know anything else, and you have to be able to communicate with those people in a way that they understand.
Because they deserve to know the information to, and I think that’s kind of the biggest disconnect.
Andy Hagans: yeah that’s really interesting you know, I was talking with the guest last week on the show we were talking about the definitions of very high net worth and ultra high net worth.
And I remembered reading ultra high net worth I believe it was 25 or 50 million and very high net worth was either like five or 10 million, unlike those textbook terms and those definitions.
Probably from 10 or 20.
Years ago, I mean even the inflation of the last year alone.
And then you know talking about an accredited investor, for instance, you know those definitions I don’t believe they’re adjusted for inflation, or at least they haven’t been for quite some time.
So it’s interesting to this private equity world when you talk about different amounts of investable wealth, how much it changes the picture right, because if.
You kind of alluded to, if you’re a billionaire Why would you bother making an investment of a million dollars right unless it’s 100 X return.
it’s like why I don’t want to deal with the complexity, or the mental overhead of even thinking about this if it’s such a small percent of my net worth.
So, you know how, how do you handle then running a private equity fund sort of that initial screen of Okay, I know you’re an accredited investor like obviously legally, you have to verify that.
But other other you know goal goal oriented questions that you ask a prospective investor to even you know see if if your fund or really any alternative investment is a good fit for their goals.
Kelly Ann Winget: yeah sure, so a lot of it has to do with making sure that they understand how a private equity fund works compared to maybe some of the other products that they have exposure to typically they’re like fixed income.
or annuities or interest something like that right, which they still probably don’t understand but.
it’s really it’s really about explaining that we’re taking risk by funding these businesses, and so the returns are variable and unpredictable.
And as long as they can kind of understand that and don’t have expectations of returns, then you know, then we go into this is the strategy and how we plan on making money, and this is what we intend to make from these investments.
But it’s always kind of a two fold conversation and make sure that they understand that there’s a lot of risk, but if you can accept that, then this is how we’re moving forward.
Because it is it’s definitely riskier than some of the stuff that they have access to from a traditional investing stance.
Andy Hagans: So, would you say your fun it’s not only intended to provide portfolio diversification, but it’s also just for alpha.
To potentially juice overall returns Okay, so why don’t we going back a little bit to your experience with the family office and the private equity industry doing bigger deals.
What kind of projects or deals or investment segments where you researching were you working with and and which which ones of those are you now involved with with your own fund.
Kelly Ann Winget: And that company in particular was real estate oil and gas and tech.
When I was on boarded technology was, I think they’re kind of newest branch.
majority of the management team had most of their experience in real estate it’s where they made a majority of their wealth in the beginning, and then.
I from my opinion they got really lucky in 2016 after oil corrected in 2015 and bought a really good property and then kind of took that experience or lack of experience to buy new oil and gas.
assets and then kind of went from there, but.
They brought me in because no one else on the team had had any experience in oil and gas, or at least talking to investors about oil and gas, and because I have you know multi generational experience.
And my family owns different types of oil and gas assets that’s why I was initially invited in it was a very short.
That was what they were, and they were in those three sectors, and we do that in our diversified fund as well.
Right now we’re heavy in oil and gas, just because the when we bought these assets, when we launched our fund gas was at $1 60 and oil was $60 so 5055 on some of them, so now we’re you know almost $9 gap ass and $100 oil so.
This is just a space that I know a lot of information about and watch very closely so we’re aggressive in that area, but we do have.
Andy Hagans: So i’m sorry to interrupt what kind of oil and gas deals are they are they.
You know, buying real estate buying contracts, I mean talk to me explain like i’m five years old, which piece of the oil and gas industry are you specifically working with.
Kelly Ann Winget: So there’s kind of multiple ways that you can get involved in oil and gas there’s the real estate side, where you own the land.
And then you lease that land to oil companies or you own the mineral rights, which are all you know everything below the ground as far as real estate is concerned.
And you get paid a royalty when oil companies come and develop that mineral and then you have your working interest so you’re working interest is where you’re actually participating in the development of the well.
Right now, we have a little bit of non op, which means we are not the operator on the project.
But we do own the working interest, so we are exposed to drilling costs, but we aren’t, the ones who are actually doing the drilling.
And then we have some that where we are partnered with the owner or the operator and so that working interest we do.
it’s considered operational, even though you know us as as alternative wealth partners isn’t the operator we behave like the operator, because we are partnered with the operator.
And that’s kind of the two ways that we participate we haven’t had an opportunity necessarily to buy minerals, just because of the way I have this fund structured and the return expectations, I need from the assets minerals.
haven’t been able to meet those so we stick to working interest for the most part that’s where your highest return is an oil and gas.
Andy Hagans: So my radar just picked up so you mentioned return expectations, so it sounds like you’re purposefully looking for higher return obviously higher risk coming you know.
Type projects, and I know in the in the you know, in the Grand scheme of things you have a smaller private equity fund right it’s not family office sighs yeah.
Not not competing with black stone yet so is that something that can enhance returns basically getting involved in these smaller projects, I mean are they essentially good projects that might.
go below the radar of a family office or is it like the opposite where because they’re smaller there’s actually more competition from I hate to say it matures but.
You know, smaller investors, you know, does it does it matter.
Kelly Ann Winget: And also oil and gas is kind of a funny industry it’s it’s it’s very small, especially here in Texas, like everybody kind of knows what everybody’s doing but.
You know, small owner operators small producers in the United States provide like 30% of our production so there’s just a lot of us and typically it’s self funded that’s kind of really the.
The barrier between a normal person getting access to oil and gas and not is that most of it is just self funded, these are families that have been trolling for generations.
And they’re just.
developing their own properties or surrounding properties that they’ve already worked on.
there’s there was a big influx of competition in 2013 and 14 when oil into $130 but our last time we had a bunch of people just randomly jumping in and like over syndicating deals.
And that’s when you had investors probably lose a lot of money when you have when you talk to retail investors like i’ll never do oil I lost so much money in oil but it’s typically not from a dry holtz usually because somebody.
mark the deal up too much and they weren’t able to deliver on it so because oil corrected went down to $30 a barrel so.
it’s really about making sure that you know when to buy in and working with people that have either done this on their own dime a lot.
Or have their own money in it now, and I think that’s kind of the big difference, a family office family offices are going to look at a deal that’s under 100 hundred million dollars.
And we get to partner with people in the institutional space to take down those bigger deals for our little baby fund.
We have a deal that we did out in West Texas, that the entire property was 100 million dollar purchase price.
Our our relationships in this space we worked with a single family office that bought that hundred million dollar property they wrote the check and then we were able to fund our 15% so we bought $15 million of that hundred million.
A few months later, but they were able to write that whole check up front and then give us our portion when we were ready.
That was a kind of a unique deal because there was so much production on that property that it was able to lower our out of pocket costs by almost half, so instead of us taking out $10 million worth of debt to cover our $15 million we only had take out four and a half.
Bring 2 million of equity so.
You know those Those are the kinds of things that we’re able to do just because we have these you know special unique relationships.
And that’s really how oil and gas works like you either, if you get a phone call from a stranger about oil, gas deal they’ve probably bought the prospect from somebody else and marked it up 40% yeah.
And I told you, before we got on the recording that I will tell you what the secret was to oil and gas deals.
And if you’re looking and shopping for like independent oil and gas deals if they can’t do a two year payout between 55 and $65 oil they’ve marked it up too much so they’re they’re running a little fat.
Because right now the way with the technology and one gas that there should be no reason that somebody lift cost is.
High that higher it should have a two year pattern $65 oil no problem.
Andy Hagans: There we go I love a rule of thumb simple heuristic I love it okay so we’ve covered oil and gas, so the way I understand your funds, private equity fund and it’s diversified basically into three.
Different segments broad segments and roughly targeting one third, and each segment maybe a little overweight oil and gas, right now, just because you know, current events, probably driven valuations ever let’s talk about those other two segments.
Kelly Ann Winget: Sure, so private equities kind of broke it up in a couple different places, so.
In in our presentation we talked about you know portion of our a big portion of our fund is allocated to manufacturing and that’s just because I really like the infrastructure space, especially with the big you know rebuild America incentives that are going on, so.
I definitely am somebody I consider to be lucky, or at least someone who takes advantage of opportunities and a few years ago, I met someone that I referred to as the crazy gun guy.
And i’m in Texas, I have you know lots of crazy gun guys around me, but this one in particular was growing his ammunition manufacturing.
Company, and so I worked with him for a few years just to kind of get him streamlined and when hit.
Basically, demand exploded, and then supply disappeared.
And so it was a huge opportunity for us to like okay now you’re ready to take on investor capital, and it was one of the actually the main reasons why I decided to build the diversified funds because.
I could create a foundation asset in the diversified fund with this ammunition manufacturers.
That would just kind of hold the base return for the investors at 15% and then build on top of that, to get higher equity returns.
For these exits that will happen later in the Fund but protect the cash flow from this debt opportunity with the manufacturing company and now they’ve been able to turn that capital into.
Their next phase, which is producing primers, which is why we have an ammo shortage there’s only three companies in the United States that make primers and now this company is the fourth and they have a capacity to do about 4 billion primers a year.
And the margins on it are just ridiculous right now primers going for about four and a half to five and a half cents on the wholesale side.
And we’re able to kind of take advantage of that with our relationship to you know profit.
Andy Hagans: So it’s it sounds to me like you’re actually comfortable in a variety of spaces in the private equity world, given that you have.
You know, understanding and relationships and those spaces and you really like having the freedom to be opportunistic right if the.
Risk reward ratio is there, then you know that it makes sense to do that deal, so, as you said you found that deal that sort of provided the baseline to your fund.
And then you have that freedom to opportunistically go into other spaces, is that.
Is that sort of the just or are you more okay.
yeah so then what’s what’s the third space and we’ve talked about manufacturing.
we’ve talked about oil and gas.
So what’s the third segment that you operate in.
Kelly Ann Winget: So we had we have space to allocate to real estate, we have done a little bit of real estate, so far, a majority of our CAP, so I launched this fund May, June of 2021 it took me about seven months to like figure out the structure and find the assets and negotiate the deals for.
acquisitions as soon as capital came in, so we launched in May, June of last year, a majority of the capital came in December January so realistically we’ve had about six months with deployed capital.
And the first part of our strategy was to make sure that we had some cash flow coming to the investors, so that we can like patiently wait around for the equity stuff to exit.
So we have some real estate that we were able to.
Close on because, again I have really high hurdles in this fund so real estate’s very competitive right now and there’s just no way that your typical real estate deal is going to return 30 40% a year.
So the properties that we’ve been able to find have been extremely off market like convincing people to sell.
or overhearing and commerce, one of our product properties, we bought in East Texas.
One of the tenants of the building overheard the owner talk about her divorce and went in and offered her to buy the building and then called me and said, I want to buy this building so.
You know that’s kind of the opportunities that we get to take advantage of because the return potential there can be much better than anything else, that you would find you know syndicated online.
Andy Hagans: gotcha so Okay, so we have real estate, we have oil and gas food manufacturing and and private equity world let’s talk a little bit then investor facing.
about the structure of your private equity fund I know a lot of our listeners and viewers of the show.
they’re used to investing in private placement offerings in the real estate world either you know single asset funds or maybe diversified in a particular sector, whether it’s multifamily or.
Any other kind of commercial real estate i’m guessing like the fee structure returns waterfalls all that is a little bit different with a diversified private equity funds so, can you walk us through how that structured.
Kelly Ann Winget: Sure, so um typically you’re going to see these funds with a management fee and then some sort of equity split after preferred return.
And so, because this is the first fund that i’m managing like on my own the investors are taking a lot of risk and trusting me with that right, so I wanted to make sure that.
The investors understand that my interests are aligned with theirs, so I front, all of the cost for the fund out of the GP split.
So that they get 100% of the revenue of the Fund until they’ve seen 10% returns once they’ve hit 10% we split everything at 20 and the cost of the fun comes out of that 20% split so they’re not exposed to any of the overhead of the fund.
Andy Hagans: Wait it’s at 22 the investor.
Andy Hagans: wow okay so that’s a more investor friendly waterfall than.
You typically see in.
Like the multifamily world.
Kelly Ann Winget: For instance, right yes.
Andy Hagans: Okay wow.
Andy Hagans: I.
Kelly Ann Winget: I did.
Andy Hagans: sounds sounds very enticing and it also sounds very.
risky, I guess, in terms of to get those kind of returns, you have to be comfortable with higher volatility, so I mean oil and gas.
It just as an industry higher risk.
That That being said, that the diversified strategy of being in three different asset classes that are less correlated makes a lot of sense but sorry I interrupted you there so there’s that there’s that hurdle of preferred return that goes 100% to the.
lps and then after that it’s at 22 your lps and you’re burying the cost management costs, out of your 20%.
Yes, and is there a target raised like will this fun be open for X amount of time, do you plan to close it a certain date is, are you trying to raise a certain amount of assets or.
Kelly Ann Winget: Yes, so it it’s filed for a $50 million fund, we have about 15 million under management, right now, because of the way that i’ve structured, the fund I don’t intend to raise the 50 million and that’s just because i’m the assets that i’ve put in this fund.
Were intentional and I just I don’t want to give it all away so I probably want to raise somewhere between five and 7 million more and then close it.
We have until the end of 2023 to do that, but my intention is to close up before the end of the year and that’s just because we’re already in paste at us and, most of these assets, so the investors are already getting dividend some investors got their first dividend 30 days after investing.
And that’s just because, obviously, oil and gas prices are really high so you know when we complete a well we’re making a lot more money than we originally planned, because we bought these again at $1 60 gas and $55 oil so.
Andy Hagans: So do newer investors like let’s say someone calls you up tomorrow and invest tomorrow or they get in the same to you all that someone who invested a year ago cats.
Kelly Ann Winget: They they hold for two quarters, so they do not get dividends for two quarters and then marketing dividends, and that was something we had to implement after the fact, is because we had.
Three and a half million dollars come in at the end of the year that diluted everybody’s shares.
But they still all got a return it was just a difference of the people that came in and June, July, who are looking at like a six to 8% return their first dividend we’re now getting to so.
We changed some of the rules for people to hold for six months, just so that we can play some catch up on those investors who came in in the beginning to start getting their dividends before everybody does that’s the kind of the whole push of closing before the end of the year, because.
2023 will probably be our highest income year just from cash flow, because we have all of the oil and gas projects that we drilled are being completed like right now, and this month and so far we’ve.
haven’t had we’ve had one well that didn’t That was a dry hole, but it was inside of a group of well, so it doesn’t really matter that it happened it doesn’t affect the overall return.
So we’ll see all of that revenue start coming in, basically, the first quarter of next year.
Because if you haven’t worked in oil and gas it works in about a 60 day 90 day delay before you get reverse checks.
Andy Hagans: Well it’s a lot faster than you know ground up development in the real estate world.
Kelly Ann Winget: Well, I want it, because the thing is I don’t get paid until the investors get paid.
So i’m trying to pump out as much cash flow as possible.
So the investors are getting something so then now I can get my portion right as soon as I can get that money back into the hands of the investors, then we start splitting everything.
Because, as much as I love working for free I don’t want to do it forever.
So that’s kind of the motivation about buying those cash flowing assets first and then buying the equity assets which we have some in the fintech space that are pretty cool so.
Andy Hagans: So let’s talk about those assets in the fintech space to the degree that you can I don’t know where those you know deal Stan where they are in the process.
So that like venture capitals that debt financing.
Kelly Ann Winget: So we one of the things that we can talk about is we invest in the series be round for LM S, which is Sally projects.
Project she’s launched a basically a robo advisor and private wealth.
Firm for women, so the entire algorithms are built around the investor being a woman, and what that.
What kind of risk profile, that is, and the different things that happened to women in their lives that affect how they can invest like we make less money we work for less amount of time, so these things get factored into how.
Andy Hagans: live longer let’s not forget live longer.
Kelly Ann Winget: If we are we live longer, so we need more money, but money and so that kind of just goes into their investment planning, and so I don’t know if you know anything about sallie krawcheck but she’s you know basically a.
shark in the private wealth space.
CFO of Citibank basically responsible for Merrill lynch’s private wealth entire portion of their business.
But she is a pretty aggressive person, so I feel like she’s the right person, the head of this so we’re just we’re we’re a small investor alongside some pretty big people on her series be around, and then we have another.
i’m trying to figure out how I can talk about it it’s a kind of a friends and family they don’t want to raise any any capital from private equity or venture capitals groups.
Because they’ve been able to kind of self fund their.
Software from the beginning and so.
One of the team members is friends with one of my investors and so that’s how we were brought into the deal.
And so we’ve been able to kind of negotiate some.
Preferential shares of the business and so it’s more in the.
Accounting treasury space.
And it’s a global software, so you know government entities can use it.
it’s very big brother worry, but I really understand the value of data and that’s where the value of that company is going to be is in the data it can collect from its software.
Andy Hagans: Well, in regards to that big brother, I mean if you can’t beat them join them right.
might be might be something that I find objectionable on.
On one, on the one hand, but be happy to be an investor and on the other hand, right so, and you know, during our conversation, so I want to actually rewind you said one really interesting thing in regards to manufacturing.
Because that’s been a hunch that i’ve had.
But we can probably ignore that because it’s not like I really invested in it, so you know it’s kind of a throwaway hunch.
But manufacturing in the United States or even manufacturing domestically at all, you know we’ve had the war in Ukraine just shown with energy, you know how important energy policy and energy suppliers.
But even prior to that with coven and the lockdowns and we saw these supply chain constraints, you know we’ve had this long term trend.
of deflation and cheaper cost for everything right you go to walmart everything is just getting you know, in the long run adjusting for purchasing power.
has become more offshore and less expensive given purchasing power, not everything, a lot of things happen, but a lot of those sort of everyday products that we buy at a walmart have.
That trend has sort of temporarily reversed.
Right in the last.
Two or three years, do you see that as a temporary blip in the radar where we’ve you know the trend has been towards international trade and.
You know disinflation or do you see that more as we’ve had a more permanent not permanent a more lasting paradigm shift to where this is going to be a trend that last a couple decades now to where there starts to be some more on shore and more domestic manufacturing again.
Kelly Ann Winget: I think that we’re going to see kind of a similar effect as like the World War Two right.
All this crazy stuff was happening overseas, and so we started bringing.
More of that process home.
And I think that we are we’re not at the level of there’s going to be a third world war, but there’s definitely enough disruption where we’re like um maybe we should just do this at home.
And we’re going to automate a lot of that so I don’t think it’s going to be like oh let’s send the masses back out to the workforce, and you know we’re here we are, industrial.
Times again it’s going to be all done with robots right and technology, but I think that we’re just going to be.
more careful about what we’re giving away as far as technology goes, we gave a lot of our technology away to China.
And so they were.
able to produce it faster and cheaper and I think we’re just going to be more of a hoarder for a while.
Because right now we do hold a lot of the power globally in many different ways, and I think we’re just going to hold on to that for the time being.
Especially yeah, especially if the administration changes so.
Andy Hagans: it’s it’s a really interesting analogy i’m thinking through you know the late 1940s, the early 1950s, obviously, a lot of domestic manufacturing then.
i’d have to look up the data i’m guessing bondholders during that period, just got totally crushed.
I know war bonds were maybe not the greatest investment side another country had a pretty high level of national debt.
I mean out of the war.
But we also have favorable demographics in the late 40s in the 1950s, with the baby boom right so it’s a little different now we’re probably similar greater levels of debt, but not as favorable of demographics that’s that’s probably a different discussion.
more of a policy discussion, I want to bring things now turning to our investors.
From investors you point.
A lot of the listeners viewers of our show are used to investing in private equity real estate and I think your Fund is a very interesting some of the asset classes.
That you’re working with what are some tips that you would give investors who are maybe they’ve bought into alternatives, you know they’ve invested in private placement offerings.
But some of these segments, some of the at these asset classes are new ground for them what are some tips, you would give them to sort of navigate the space, and you know even in talking with sponsors are looking at different offerings how to evaluate those.
Kelly Ann Winget: The real estate space has gotten really interesting just because.
I think people are trying to take more control and there’s a lot less barriers of entry into real estate basically anybody can invest in real estate.
Either with your own money or somebody else’s money and there isn’t as many regulations as there.
Andy Hagans: is not a bad thing sorry just just stop right there.
Is that is that a bit Does that mean lower returns, if you know the barriers to entry are lower does that just mean that it’s.
Kelly Ann Winget: Not necessarily it’s just a.
I think it’s.
I think it’s riskier when you have a lot of people with not necessarily a lot of experience, doing the same thing.
There are really good managers in the real estate space, but there are a lot of people who just read the same book and are now.
gurus have financial freedom because of real estate and I think I think that’s really what the risk is is make sure you know who you’re dealing with and how long they’ve been doing it because.
If their experiences post 2008 should like we are they have not experienced loss, so you know you just need to keep that in mind, you know what have they been through in the cycles of their investment assets space.
You know i’m not very old but i’ve seen to corrections and oil and gas, you know people who are just slightly older than me have seen like three or four so you know you want to pay attention to those people who have experienced that.
people that have been like day traders, for example, who have been enjoying the market for the last 10 years it’s just gone up.
You know, maybe don’t know what’s going to happen next, and they can’t speak from any type of experience, because they haven’t experienced loss.
that’s kind of the and I have a lot of opinions about the brand new financial advisors coming into service over people in that 50 to 60 year old.
age range as financial advisors.
Andy Hagans: So it’s up so like our eyes or financial planners just because they haven’t.
lived through necessarily the market cycles, maybe have a harder time advising clients.
Kelly Ann Winget: I just asked them what their opinion is you know if they if they think you just want to make sure that they understand that there’s these things that can happen because we’re in a totally unprecedented time you know.
Andy Hagans: You are some things that could never happen inflation could never go about 4%.
With permanently kicked inflation so.
Kelly Ann Winget: it’s just it’s just an interesting thing because.
You know, for those of you who only in the.
The public market is just a.
Wild gambling time and.
You just have to understand that there’s risk in both places and even though we’ve been in this like incredible market.
there’s things that are happening that are going to drastically affect that, but no one can time anything so.
Andy Hagans: You mean like the bond market could return negative for a decade the stock market can actually the publicly traded stocks can return negative over a decade.
I had met favor on the show.
a while back, and he has researched it just people are totally clueless I mean you’re talking about going back 20 3040 years.
he’s talking about going back 150 years and looking at public stock markets, people have no idea, even a 5050 portfolio or 6040 portfolio that kind of volatility that they had in the depression.
And you know, maybe not in my lifetime, maybe in my lifetime right, so I think your point is very well taken you know, on the subject of of timeline.
And we’ve already kind of alluded, you know different investors have different time horizons.
You know the term of patient capital, you know that’s the institutional capital that can just afford to hold and hold and hold and not every investor.
necessarily has that luxury with with your fund is there an exit strategy will the fire and wind down at some time or is the idea to establish cash flow and so.
Kelly Ann Winget: We only it’s a five year fund.
So a structured this.
Kelly Ann Winget: Basically, a money machine and a quick exit because i’ve spent 10 like I found the assets, before I structured, the fund.
To do this very specific thing, so I did the work prior to launching the fund and giving these companies capital and that’s kind of like what the investors get to benefit from it’s my.
contribution to the fund right the investors take the risk with their capital, I took the risk with my time.
And so we plan to either fully exit out of these assets within the next five years or we’re going to.
it’s a small fund so like right now, I think we have little under 60 investors individual investors and that’s not a large group to go to and say hey.
This asset can cash flow for the next 20 years, do you want to put it into an llc and have that, together, or do you want me to sell it or you know what do you want to do.
And that’s the plan for you know 2025 because will be fully accepted by 2026 is start having those conversations, do you want me to sell this asset, do you want to hold this asset does an individual want to buy the asset for themselves.
And we’re planning on launching two other funds, by the end of the year and that could also be a potential exit so.
Andy Hagans: So tell us about those.
Kelly Ann Winget: are so.
Because my backers only the gas I typically get really busy at the end of the year with investors looking for it or write offs for their.
Taxes so you get a pretty big tax benefit when you invest directly into oil and gas development it’s an almost 100% deduction so.
You can really help offset your tax burden when you invest in oil and gas, and this is just because the government doesn’t want to pay for it and they give the investors, the opportunity to support the industry and get the tax benefit.
So, because of that, and my relationships with several CPA, as I have a CPA my board, I have to CPS who are clients in the fund my parents were CPA it’s like I really connect with that group of people.
So we’re going to launch a smaller energy fund that will just be in oil and gas for development.
For tax reasons so there’s still be really good.
prospects, but it will all be development there won’t be any existing production or anything like that, like we have in our fun now.
Andy Hagans: But the idea being to take advantage of you know you’re able to find good projects good deals.
But that’s the fun, I want, if I want to write off 85% of my investment in your.
One go okay.
Kelly Ann Winget: Yes, and so we’ll do a smaller fun like that somewhere between probably 15 and $20 million.
that’s for the small business owners that need you know, to put 100 to $250,000 into an oil and gas deal to save themselves, you know 20 to $40,000 on their taxes and then we’re going to launch a larger oil and gas deal.
that’s going to be a $500 million energy fund and that’s going to be both renewable and oil and gas, I have about close to $200 million worth of oil and gas projects that we could fund that typically I work with larger investors, just to do independently, but.
I just wanted to them now so.
Andy Hagans: I need to have you basically have a.
pipeline teed up.
And so you started this first fund that was.
I don’t want to say pet projects but projects that you’ve you’ve viewed high risk, but very high reward.
mm hmm and you gave.
Investors pretty good.
You know return fee structure, all that for that first fund sort of reward them for.
You know, investing their money with you on your first fun and now that that fund is ongoing gaining traction.
Your springboard in that into these these other two funds in the oil and gas space.
And I think it’s amazing I mean it’s it’s.
it’s really cool to hear about someone who is.
You know, working on the inside, on that institutional side getting access to what sounds like an amazing deal flow deal pipeline bringing that to make it accessible.
To the retail investor I think that’s a really compelling story and honestly that’s what I try and do on on the podcast here this tell interesting stories right because it was all about money, get boring pretty fast.
yeah That being said, i’m guessing we have some listeners and viewers, who are interested in your fund.
So where can they go to learn more about alternative wealth partners.
Kelly Ann Winget: And so we have a lot of information on our website, which is just alternative wealth partners COM also if they want to find me on linkedin I am pretty active online as far as.
Writing opinions about things that are going on in the world i’ve published a couple articles there’s quite a few interviews i’ve done over the couple years that are available on Google, so if you Google me you’ll find it.
My team is always here, so if you go online to our website and submit a contact sheet will reach out and set up a call to either have one on one with me or somebody from the team, I try to talk to every single investor that comes into the fund before they invest just because.
it’s a two way street, like we have to like each other, I have, I have fired two investors, so far, so.
it’s not I don’t always say yes and.
Andy Hagans: On your good behavior folks.
Kelly Ann Winget: it’s it’s important I want this to be a long relationship and.
You know this is fun one of many.
Andy Hagans: And life is too short Kelly i’m 100% with you.
Kelly Ann Winget: Right, so if you’re not if you’re not on the same page, then you know I it’s best of luck to you out in the world, but it’s not with us so.
Andy Hagans: Absolutely I love that and for our listeners, if you want links to everything we mentioned in today’s episode, you can always visit all stevie comm slash podcast to access the show notes i’ll be sure to link to.
Alternative wealth partners, as well as to kelly’s profile on linkedin looking forward to checking out some of those videos.
And don’t forget to subscribe to the Alternative Investment podcast on YouTube and on your favorite podcast listening platforms, you can be sure to receive our new episodes as we release them. Kelly thanks again for coming on the show today.
Kelly Ann Winget: Thanks for having me i’m so excited about talking about everything thanks for having me.