Whats going to be different about raising capital after a pandemic?

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What’s going to be different when raising capital post Corona virus?

 

A Tsunami of online real estate syndications will become available in the United States

Learn how to effectively use online syndication during this time of crisis to make your real estate business thrive.

 

Stronger domestic supply chains.
Todd N. Tucker is director of Governance Studies at the Roosevelt Institute.

In the ancient days of 2018, the Trump administration was panned by experts for imposing tariffs on imported steel on a global basis for national security reasons. As the president tweeted at the time, “IF YOU DON’T HAVE STEEL, YOU DON’T HAVE A COUNTRY!” But to most economists, China was the real reason for disruptions in the metal market, and imposing tariffs additionally on U.S. allies was nonsensical, the argument went: After all, even if America lost its steel industry altogether, we would still be able to count on supplies from allies in North America and Europe.

Fast forward to 2020. Just this week, U.S. allies are considering substantial border restrictions, including shutting down ports and restricting exports. While there’s no indication that the corona virus is being transmitted through commerce, one can imagine a perfect storm in which deep recessions plus mounting geopolitical tensions limit America’s access to its normal supply chains and the lack of homegrown capacity in various product markets limits the government’s ability to respond nimbly to threats. Reasonable people can differ over whether Trump’s steel tariffs were the right response at the right time. In the years ahead, however, expect to see more support from Democrats, Republicans, academics and diplomats for the notion that government has a much bigger role to play in creating adequate redundancy in supply chains—resilient even to trade shocks from allies. This will be a substantial reorientation from even the very recent past.

The corona virus pandemic will create pressure on corporations to weigh the efficiency and costs/benefits of a globalized supply chain system against the robustness of a domestic-based supply chain. Switching to a more robust domestic supply chain would reduce dependence on an increasingly fractured global supply system. But while this would better ensure that people get the goods they need, this shift would likely also increase costs to corporations and consumers.

It’s no secret that millions of people have had to dig into their retirement income lately and there will be new challenges in the years ahead, making the demand for alternative assets that produce income even more important.

The baby boomer generation owns more small business than ever before approximately $10 trillion worth.  It is estimated that 77 million baby boomers will retire, and many will need to find additional capital or sell their businesses between 2020-2022.

It’s a fact, retirees are living longer. While that is certainly a good reason to celebrate, it also means there’s an increasing risk that Boomers may outlive their savings.  Life expectancy for ages 65 and older has risen to 84.4 years.

The risk of increased inflation is also something boomers are highly aware of, having lived through a period of hyperinflation in the 1980s.  They understand what it means to lose purchasing power.  Combining inflation with increased longevity, boomers will be transitioning from their accumulation years to their distribution years as they see the need to find additional income.  One potential solution will be a greater allocation to alternative income-focused assets.

SMEs that understand this new economy will win big if they think like investors.

Self-direct Offerings, in combination with SBA loans can be an active approach to building a company.  It takes a lot of work and long hours, but with a self-directed Offering you can gain immediate ownership of assets with inherent value and be placed in the driver’s seat ready to take full control of added value to your company.

If you think a self-directed Offering is for you, and you want a high-quality team to help you prepare and market an Offering, we have an established process in place based on our own experience and we want to share it with you.

Self-Directed Offerings are hard, complicated, and involve upfront money.  They are stressful and risky.  In fact, almost everyone who’s ever tried it alone ever finishes.  We believe the reason for this is the lack of a proven process.  We believe we can help you solve this problem if you are willing to commit to investing your own money, and betting on yourself.  You will be the most important part of the equation, but Open Source Capital will give you a concierge blueprint for a successful capital raise, and a road map for improving the odds of building a more successful business.

If you would like more information schedule a call with us