Elkstone Partners for investment

Almost certainly, private equity investments aren't something that most investors, and likely the vast majority of Askaboutmoney users, should be investing in. This is a very niche area usually only suitable for very high net worth individuals who already have a diversified portfolio covering more mainstream asset allocations. There are some existing threads on the topic that might be worth reviewing.

 
I find it slightly odd that they are running a very extensive ad campaign on the radio (the main cohort of listeners will be normal people/retail investors) yet state their products are not suitable for retail investors.
 
sharedRespon said:
The fact that PE is looking for retail investors says a lot about the health of the sector generally
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They're trying to tap into a potentially massive market for them....one that could cause havoc with retail investors who are left trying to retire and end up having to segregate their PE investment from the rest of their other pension assets and it's sitting there for years, a big illiquid asset that isn't doing anything.
 
Their fund is Venture Capital, not PE. PE is much less risky than Venture, so venture extremely risky for a regular investor and highly illiquid. RE Elkstone, I'm absolutely shocked that the Central Bank are tacitly approving their blatant solicitation of commitments from the general public. The key to remember is venture or PE funds take a 2% management fee annually for their day to day operations during the investment period of the fund, then the management fee switches to 2% of invested capital. A fund operator can probably get away with 6-7 years of underperformance (particularly in Venture as they can suggest it takes a long time for early stage investments to mature) by which time they can be on their second or third fund and its a bit of a grift to earn fees rather than drive performance. If ever looking at such products, look for smaller funds with a high hurdle (8-10%) before carried interest is paid - this ensures that the fund manager only makes good money on strong performance. In general neither Venture nor PE funds suitable for retail investors or anyone who isn't fully au fait with how it all operates. On Elkstone, probably worth looking at how many times they've been stuck in legal spats...
 
They don't do private equity. What Elkstone say they do and what they actually do are not the same thing. I know the sectors of PE and VC very well and I am very acquainted with Elkstone and how they operate and what they have and do invest in.
 
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