Private Equity Funds have been found to consistently provide investors with higher rates of return when compared to other investment methods. Investment advisor Simon Gillett shares his insights on the benefits of PE Funds.
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According to the financial data providers Preqin and Morningstar, Private Equity fundsposted an average annual return of 14.2%, between 2010 and 2018, compared to 7.3% for the S&P 500 index, including dividends. That substantial 6.9% difference in ROI is why many business leaders are choosing to place their money in the hands of the experts. As General Partner at The Global AI Internet Freedom Fund LP (GAIIFF) and member of Opportunity Network, I see this difference every day.
At GAIIFF, I assist businesses with making long-term investment decisions. Having recently partnered with Amazon Web Services (AWS), we integrated AI into the PE fund platform, providing our investors with a competitive edge in a cost-sensitive and technology-forward industry.
Using AI to identify cash-flow positive companies who are in the growth stage of development and are well-positioned in their market, GAIIFF is able to pin-point the stage in companies’ maturation during which it’s optimal to invest. This process of predicting technological progress and enabling data-driven investment decisions works especially well with PE funds. Having experts overlay the hard data with their experience and intuition is key in maximizing entrepreneurial alpha and increasing investor returns.
Outside of AI innovation, I believe that there are 3 additional key reasons why Private Equity Funds are the best way for business leaders to invest:
1. Commitment to success
PE Funds have their own vested interests in making your business profitable and successful. You can rely on the fact that the fund will do everything in their power to ensure you receive more than what you invested.
PE fund investors are invited to numerous top tier networking events. Targeted at CEOs and company leaders, these events are great platforms to meet interesting people, who can be powerful business connections.
3. Your Investment in Experts’ Hands
PE funds can supply the talent your business is lacking. Investment managers are experts in their field and are supported by data and analytics that ensures they make the right decisions. They know how to maximize an investment’s value.
Private equity funds are experts at creating value. Today’s technological improvements have set a new path for investments, and accurate data from AI and machine learning can guide decisions to ensure successful results. This combination of expertise and technological integration is a perfect formula to bring investors the best returns possible. An investor’s returns are a priority for his fund, and any tool that can help build these returns will no doubt be evaluated and used.
Simon Gillett is currently a member of Opportunity Network
The current GAIIFF fund is a 3-year fund exclusive to qualified clients and is registered with the Securities and Exchange Commission.
CEO and Managing Partner at GAIIFF Alternative Investments Professional