An investment club is a group of individuals who share a common interest in achieving their financial goals. A number of contributors pool their money together in order to create investing leverage with a larger lump sum of capital than if they were to invest individually. This creates the opportunity for a number of individuals to add assets and net worth to a portfolio in a short amount of time. There is a lot of room for creativity in developing a business plan for a club, and by the end of this series you will have an example of a plan you could incorporate with prospective partners.
Strength in Numbers
The vision I have of an investment club, is that it is a financial group or alliance, if you will. It has been a corner stone that successful families have used to build a legacy that would create prosperity for generations to come. If you have ever heard someone say, “My family owns that campground” or “My family built that hotel”, and so on, did it occur to you that this individual is not talking about some estranged rich uncle? When I watched a documentary on the one percent of rich America, there was a scene where the Johnson and Johnson family were having a “family meeting”, with the family wealth advisor, that opened my eyes! A family that works together financially instead of working individually or competing! So this brings me back to the individual who says their family owns this or their family built that, what they are actually saying is that their entire family owns a piece of said asset, kind of like a shareholder of a business. If the family has pooled their money over the years and bought a campground for instance, all family contributing members own a piece of the camp and could enjoy fruits of that cooperation in the form of Summer time gatherings, and not to mention any revenue that may be earned from renting lots.
This concept of synergy, to me, is simply:
· If I have a dollar to invest alone, and you have a dollar to invest alone. We each have one dollar to invest alone.
· Synergy says,” We have two dollars to invest together and compound our rewards in less time.”
· The end result is not how much cash is gained, but rather how much time is saved.
Welcome to the Club
Cooperative investing for mutual benefit is not a concept that is only reserved for families who understand the power of synergy, but any group of individuals can band together whether it be co-workers, friends, or just like minded people in your network/neighborhood. This is when the investment club can be looked at as a business model, or as an entity all on its own. The participants all have an equitable stake within the business. Think about companies like “XYZ” Capital, or “ABC” Financial, etc. Those are companies that simply control capital to acquire assets that will increase the company’s net worth and/or overall revenue. Each company/club could have a different focus on how the capital is invested, but the commonality among all investment clubs/firms is to increase the value of each participant’s equitable stake within the company, and trickle down cash flow (dividends) from the assets that their stake helped acquire. In part 2, I will give an example of how this business model can be set up and help you and your team reach financial prosperity.
The vision I have of an investment club, is that it is a financial group or alliance, if you will. It has been a corner stone that successful families have used to build a legacy that would create prosperity for generations to come. If you have ever heard someone say, “My family owns that campground” or “My family built that hotel”, and so on, did it occur to you that this individual is not talking about some estranged rich uncle? When I watched a documentary on the one percent of rich America, there was a scene where the Johnson and Johnson family were having a “family meeting”, with the family wealth advisor, that opened my eyes! A family that works together financially instead of working individually or competing! So this brings me back to the individual who says their family owns this or their family built that, what they are actually saying is that their entire family owns a piece of said asset, kind of like a shareholder of a business. If the family has pooled their money over the years and bought a campground for instance, all family contributing members own a piece of the camp and could enjoy fruits of that cooperation in the form of Summer time gatherings, and not to mention any revenue that may be earned from renting lots.
This concept of synergy, to me, is simply:
· If I have a dollar to invest alone, and you have a dollar to invest alone. We each have one dollar to invest alone.
· Synergy says,” We have two dollars to invest together and compound our rewards in less time.”
· The end result is not how much cash is gained, but rather how much time is saved.
Welcome to the Club
Cooperative investing for mutual benefit is not a concept that is only reserved for families who understand the power of synergy, but any group of individuals can band together whether it be co-workers, friends, or just like minded people in your network/neighborhood. This is when the investment club can be looked at as a business model, or as an entity all on its own. The participants all have an equitable stake within the business. Think about companies like “XYZ” Capital, or “ABC” Financial, etc. Those are companies that simply control capital to acquire assets that will increase the company’s net worth and/or overall revenue. Each company/club could have a different focus on how the capital is invested, but the commonality among all investment clubs/firms is to increase the value of each participant’s equitable stake within the company, and trickle down cash flow (dividends) from the assets that their stake helped acquire. In part 2, I will give an example of how this business model can be set up and help you and your team reach financial prosperity.
