Executive Summary
You've built something remarkable. Seven figures in revenue, maybe eight. A team that executes your vision. Customers who genuinely love what you do.
But here's the uncomfortable truth most successful entrepreneurs discover too late: the traditional investment portfolios your advisor recommends—those vanilla combinations of stocks and bonds—simply don't match the sophistication of your wealth-building potential.
While you've mastered the art of making money, you may be losing the game of keeping it. The same "Main Street" investment strategies available to W-2 employees can't provide the diversification, growth potential, or risk management needed to protect and grow the substantial wealth you've created.
The solution? Alternative investments.
These are the sophisticated asset classes that billionaires use to build and preserve their fortunes across generations—private equity, real estate syndications, hedge funds, and venture capital. The strategies that allow ultra-high net worth families to maintain 40-60% of their wealth in alternatives while traditional portfolios remain trapped in publicly traded securities.
Through our Fractional Family Office™ approach, we provide 7-9 figure entrepreneurs with institutional-quality access to alternative investments previously reserved for the ultra-wealthy. Our systematic due diligence process, combined with strategic portfolio allocation modeling, helps entrepreneurs implement billionaire-level investment strategies without requiring billion-dollar minimums.
The result? Our clients achieve better risk-adjusted returns while building truly diversified portfolios designed for long-term wealth preservation and growth.
The Alternative Investment Gap: Why Most Entrepreneurs Miss These Opportunities
Despite generating substantial wealth through your business, you're likely limited to the same investment options available to everyday investors. This creates what we call the "alternative investment gap"—the dangerous disconnect between your wealth-building potential and the limited strategies available through traditional advisory channels.
Let that sink in.
The Problem with Traditional Investment Advice
When entrepreneurs work with conventional financial advisors, they typically receive portfolios dominated by publicly traded stocks and bonds. While these "Main Street" investments may work for W-2 employees with steady paychecks, they often fail entrepreneurs who require:
- Enhanced diversification beyond correlated public market assets
- Inflation protection through real assets and alternative strategies
- Tax-efficient structures that complement complex business situations
- Income generation from sources uncorrelated to business cash flow
- Growth potential that matches entrepreneurial wealth-building ambitions
As Dave Asprey, founder of Bulletproof (over $500 million in revenue), explains: "I've counted on Dew Wealth for quite a while to help me watch the back doors to make sure I'm just not doing things that I wouldn't even see, so I trust them implicitly."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
Why Traditional Advisors Can't Provide Alternative Investment Access
The root problem? How traditional financial advisory relationships are structured.
Most advisors earn compensation through assets under management (AUM) fees—typically 1-1.5% annually on managed assets. This creates three critical problems for entrepreneurs seeking alternatives:
Limited Access: Most traditional advisors operate within institutional constraints that limit them to publicly traded securities. They simply don't have relationships with private equity funds, hedge fund managers, or real estate syndication sponsors.
Knowledge Gaps: Alternative investments require specialized due diligence skills that many traditional advisors lack. Understanding private equity track records, real estate market dynamics, or hedge fund strategies requires expertise beyond typical advisor training.
Misaligned Incentives: Since advisors can't charge AUM fees on alternative investments held outside traditional brokerage accounts, they're financially incentivized to keep your assets in manageable stocks and bonds rather than recommending potentially superior alternative strategies.
This structural limitation means that even entrepreneurs with substantial wealth find themselves restricted to investment strategies designed for far simpler financial situations.
How Billionaires Actually Invest: The Alternative Investment Blueprint
Through extensive research documented by Tony Robbins in "The Holy Grail of Investing," we know that billionaires allocate their wealth dramatically differently than conventional wisdom suggests.
Here's what actually matters: Rather than the traditional 60% stocks/40% bonds portfolio recommended by most advisors, ultra-high net worth families typically maintain 40-60% of their wealth in alternative investments.
Think about it this way—when you have the resources and access that billionaires possess, why would you limit yourself to the same investment options available to everyone else?
The Billionaire Asset Allocation Model
Private Equity and Venture Capital (20-25%): Direct investments in private companies and funds that acquire, improve, and sell businesses for profit. These investments often target returns of 15-25% annually but require longer holding periods.
Real Estate Investments (10-15%): Including direct commercial property ownership, real estate syndications, and specialized real estate funds focusing on industrial, healthcare, or other sectors.
Hedge Funds and Alternative Strategies (5-10%): Market-neutral strategies, global macro funds, and other approaches designed to generate returns uncorrelated with traditional markets.
Private Credit and Lending (5-10%): Direct lending to businesses, mezzanine financing, and other credit strategies that provide steady income streams.
Commodities and Real Assets (5-10%): Including precious metals, energy investments, infrastructure, and other inflation-hedged assets.
The difference is profound. This diversified approach provides several critical advantages that traditional portfolios cannot offer:
- Non-correlation with public market volatility
- Inflation protection through real asset exposure
- Enhanced returns through access to illiquid premiums
- Risk management through true diversification across asset classes
Alternative Investment Categories for High Net Worth Entrepreneurs
Understanding the specific types of alternative investments available helps you make informed decisions about portfolio allocation and strategic wealth building. Each category serves different purposes within a comprehensive wealth strategy.
Private Equity: Investing in Business Growth
Private equity investments allow you to participate in the growth of private companies through fund structures or direct investments. These opportunities typically target businesses with proven revenue models that need capital for expansion, operational improvements, or strategic acquisitions.
Key Characteristics:
- Typical holding periods of 5-10 years
- Target returns of 15-25% annually
- Minimum investments often $100,000-$500,000
- Illiquid until fund distributions or sale events
Types of Private Equity Strategies:
Growth Equity: Investing in established companies seeking expansion capital
Buyout Funds: Acquiring controlling interests in mature businesses
Distressed Investments: Purchasing undervalued companies with turnaround potential
Sector-Specific Funds: Focusing on healthcare, technology, or other specialized industries
For entrepreneurs, private equity investments offer the opportunity to leverage your business expertise while diversifying beyond your own company. Many of our clients find particular value in funds operating within industries they understand, allowing them to provide strategic input alongside their capital.
Real Estate Syndications and Funds
Real estate investments extend far beyond traditional rental properties. Sophisticated real estate strategies provide entrepreneurs with income generation, tax advantages, and portfolio diversification through various structures.
Commercial Real Estate Syndications: These allow you to invest in large commercial properties—office buildings, apartment complexes, industrial facilities—without the management responsibilities of direct ownership. Syndications typically target returns of 12-20% annually through a combination of rental income and property appreciation.
Real Estate Investment Trusts (REITs): While publicly traded REITs are available to all investors, private REITs offer enhanced returns and specialized focus areas like healthcare facilities, data centers, or logistics properties.
Real Estate Debt Investments: These provide steady income through lending secured by real property, often generating 8-12% annual returns with less volatility than equity real estate investments.
As Brandon Poulin, CEO of a company with over 100 employees, shares: "Once you start to accumulate and build wealth, it's a whole other thing. Earning it is one thing, but keeping it is more important, and having it work for you outside of your business."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
Hedge Funds and Alternative Strategies
Hedge funds employ sophisticated investment strategies designed to generate returns in various market conditions while managing downside risk. These professionally managed funds use techniques unavailable to traditional mutual funds.
Market Neutral Strategies: These maintain balanced long and short positions to profit from individual security selection while minimizing market direction risk.
Global Macro Funds: These make investment decisions based on large-scale economic and political trends across global markets.
Event-Driven Strategies: These profit from corporate events like mergers, acquisitions, bankruptcies, or other special situations.
Managed Futures: These use systematic trading models across commodities, currencies, and financial markets to generate returns uncorrelated with traditional assets.
Venture Capital and Growth Investments
For entrepreneurs with expertise in specific industries, venture capital investments provide opportunities to participate in early-stage company growth while leveraging your business knowledge.
Early-Stage Venture Capital: Investments in startups with high growth potential but significant risk profiles. These investments may target returns exceeding 25% annually but carry substantial risk of total loss.
Growth Equity: Investments in more established companies seeking expansion capital, typically with lower risk profiles than early-stage ventures.
Direct Angel Investments: Individual investments in startup companies, often within your area of expertise or network.
The truth is, successful venture capital investing requires proper diversification across multiple investments, industries, and stages of company development. Most successful venture investors expect that some investments will fail completely while others may generate returns exceeding 10x their initial investment.
The Due Diligence Process: Protecting Your Alternative Investments
Alternative investments require sophisticated due diligence processes to identify quality opportunities while avoiding costly mistakes. Unlike publicly traded securities with standardized reporting requirements, alternative investments demand comprehensive analysis of management teams, investment strategies, and operational capabilities.
But here's where it gets interesting...
Our 50-Point Investment Screening Process
Through our Fractional Family Office™, we apply institutional-quality due diligence to every alternative investment opportunity. Our systematic approach includes:
Management Team Analysis:
- Track record verification and background checks
- Investment philosophy and process consistency
- Team stability and succession planning
- Alignment of interests with investor goals
Financial Performance Review:
- Historical returns analysis across market cycles
- Risk-adjusted performance measurement
- Fee structure analysis and total cost assessment
- Liquidity terms and redemption capabilities
Operational Infrastructure Assessment:
- Investment committee governance and decision-making processes
- Risk management systems and compliance procedures
- Administrative capabilities and investor reporting
- Legal structure and regulatory compliance
Market Position Evaluation:
- Competitive advantages and market positioning
- Investment pipeline and deal sourcing capabilities
- Industry relationships and strategic partnerships
- Growth potential and scalability factors
As Nick Daniel, CEO of V Shred, emphasizes: "They have some awesome deal flow they share with us that we can pick from, and anytime we come back from a conference or meet someone with a company that's starting to pop up, their team will go through and analyze it and come back with a real score."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
Risk Management Through Strategic Diversification
Successful alternative investment strategies require careful diversification across multiple dimensions to manage risk while pursuing enhanced returns:
Asset Class Diversification: Spreading investments across private equity, real estate, hedge funds, and other categories reduces concentration risk in any single strategy.
Geographic Diversification: Including domestic and international opportunities provides protection against regional economic challenges.
Vintage Year Diversification: Investing across different time periods helps smooth returns and reduces timing risk associated with market cycles.
Manager Diversification: Working with multiple fund managers and investment sponsors prevents over-reliance on any single team or investment approach.
Tax Advantages of Alternative Investments for High Net Worth Entrepreneurs
Alternative investments often provide superior tax efficiency compared to traditional portfolios—particularly important for entrepreneurs facing complex tax situations and high marginal rates.
Depreciation and Cost Segregation Benefits
Real estate investments offer powerful tax advantages through depreciation deductions that can offset other income sources. Commercial real estate typically depreciates over 39 years, but cost segregation studies may identify components eligible for 5, 7, or 15-year depreciation schedules.
For example: A $2 million commercial property might generate $400,000 in accelerated depreciation during the first five years of ownership, potentially creating substantial tax savings for high net worth investors.
Private Equity Tax Efficiency
Private equity investments often benefit from favorable long-term capital gains treatment, with gains taxed at preferential rates compared to ordinary income. Additionally, many private equity structures provide tax deferral benefits until distributions occur, allowing investments to compound without annual tax drag.
1031 Exchange Opportunities
Real estate investments enable 1031 exchanges, allowing investors to defer capital gains taxes indefinitely by exchanging properties for like-kind real estate. This strategy has enabled many entrepreneurs to build substantial real estate portfolios while deferring tax obligations.
Self-Directed Retirement Account Strategies
You may use self-directed IRAs and 401(k) plans to hold alternative investments within tax-advantaged structures. This approach allows private equity, real estate, and other alternatives to grow tax-deferred or tax-free, depending on account type.
As Joel Marion, Co-Founder of BioTrust Nutrition, explains: "They were able to put in tax strategies to save me hundreds of thousands of dollars. I highly recommend Dew Wealth and the virtual family office. Take it from a high-net-worth individual who's gotten massive value."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
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Alternative Investment Strategies by Entrepreneur Profile
Different types of entrepreneurs may benefit from different alternative investment approaches based on their industry expertise, risk tolerance, and wealth-building objectives.
Technology Entrepreneurs
Tech entrepreneurs often possess unique insights into emerging technologies and business models that may inform their alternative investment strategies:
- Venture Capital Funds: Focusing on technology startups and growth companies within familiar sectors
- Technology-Focused Private Equity: Investing in established tech companies seeking growth capital or operational improvements
- Digital Asset Strategies: Including cryptocurrency investments and blockchain-related opportunities
- Intellectual Property Investments: Participating in patent funds or technology licensing strategies
Real Estate Entrepreneurs
Entrepreneurs with real estate industry experience may leverage their expertise through sophisticated real estate alternative investments:
- Commercial Real Estate Syndications: Participating in large-scale office, retail, or industrial properties
- Real Estate Development Funds: Investing in ground-up development projects with higher return potential
- Real Estate Debt Strategies: Providing mezzanine financing or bridge loans to other real estate investors
- Specialized Property Types: Including healthcare facilities, data centers, or other niche real estate sectors
Healthcare and Professional Services Entrepreneurs
Entrepreneurs in healthcare and professional services may find particular opportunities in industry-specific alternative investments:
- Healthcare Private Equity: Investing in medical practices, healthcare technology, or pharmaceutical companies
- Infrastructure Investments: Including healthcare real estate, senior living facilities, or medical equipment leasing
- Professional Services Rollups: Participating in consolidation strategies within legal, accounting, or consulting sectors
Common Alternative Investment Mistakes to Avoid
Through our experience guiding hundreds of entrepreneurs through alternative investment strategies, we've identified the most costly mistakes that can undermine investment success.
Concentration Risk in Familiar Sectors
Many entrepreneurs naturally gravitate toward alternative investments in industries they know well. While industry expertise provides valuable due diligence advantages, over-concentration in any single sector creates unnecessary risk.
For example: A technology entrepreneur investing exclusively in tech-focused venture capital funds may find their alternative investment portfolio highly correlated with their primary business, reducing diversification benefits.
Inadequate Liquidity Planning
Alternative investments typically require longer holding periods than traditional assets. You must carefully plan liquidity needs to ensure sufficient cash availability for opportunities, obligations, and lifestyle requirements.
We recommend maintaining 12-24 months of expenses in liquid investments while allocating longer-term capital to alternative strategies. This approach prevents forced liquidation of alternative investments during inopportune periods.
Insufficient Due Diligence
The private nature of alternative investments requires comprehensive due diligence that extends beyond traditional financial analysis. Many entrepreneurs underestimate the importance of thorough background checks, reference verification, and operational assessment.
As Cameron Herold, founder of the CEO Alliance, notes: "I was originally just looking for somebody to help me out with my wealth management, financial planning and to help do some tax savings; but they've been way more than that. Unbelievable to work with. Super, super high integrity."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
Ignoring Fee Structures and Alignment
Alternative investments often involve complex fee structures including management fees, performance fees, and carried interest arrangements. Understanding total costs and ensuring proper alignment between managers and investors is essential for long-term success.
Building Your Alternative Investment Portfolio
Implementing a successful alternative investment strategy requires systematic planning and disciplined execution. Our Fractional Family Office™ approach provides entrepreneurs with a proven framework for building and managing alternative investment portfolios.
Phase 1: Assessment and Strategic Development
We begin by conducting a comprehensive analysis of your current investment allocation, risk profile, and wealth objectives. This assessment identifies gaps in your current portfolio and opportunities for alternative investment integration.
Key considerations include:
- Current asset allocation and concentration risks
- Liquidity requirements for business and personal needs
- Tax situation and estate planning objectives
- Investment experience and risk tolerance
- Time horizon and legacy planning goals
Phase 2: Custom Allocation Design
Based on your specific situation, we develop a customized alternative investment allocation that complements your existing portfolio while addressing your wealth-building objectives. This isn't a one-size-fits-all approach but rather a strategic framework tailored to your unique circumstances.
Typical allocations might include:
- 20-30% in private equity across different strategies and vintage years
- 10-15% in real estate investments including both equity and debt strategies
- 5-10% in hedge funds providing non-correlated returns and downside protection
- 5-10% in other alternatives such as commodities, infrastructure, or specialized strategies
Phase 3: Implementation and Ongoing Management
We coordinate the systematic implementation of your alternative investment strategy, ensuring proper diversification across time periods and investment types. Our approach includes:
- Systematic capital deployment according to strategic allocation targets
- Comprehensive due diligence on all investment opportunities
- Regular portfolio monitoring and rebalancing as needed
- Tax optimization through strategic holding structures and timing
As Keala Kanae explains: "I get to stay doing really, really good at what I'm already good at, and I have a fiduciary on the other side that's helping diversify those investments and build towards those passive income streams that are obviously the long-term goal."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
Alternative Investment Structures and Vehicles
You have access to various structures for holding alternative investments, each with distinct tax implications, asset protection benefits, and operational considerations.
Direct Investment Strategies
Individual Accounts: The simplest approach for alternative investments, providing maximum flexibility but limited tax advantages.
Joint Accounts: For married couples, joint ownership may simplify estate planning while maintaining investment flexibility.
Entity Structures: Using LLCs or other entities may provide tax benefits, asset protection, or operational advantages for certain alternative investments.
Tax-Advantaged Account Strategies
Self-Directed IRAs: These allow alternative investments within tax-deferred or tax-free retirement account structures, subject to prohibited transaction rules and annual contribution limits.
Solo 401(k) Plans: For business owners without employees, these provide higher contribution limits and increased flexibility for alternative investment strategies.
Defined Benefit Plans: High-income entrepreneurs may use cash balance or other defined benefit plans to make substantial tax-deferred alternative investments.
Trust and Estate Planning Integration
Revocable Trusts: These provide estate planning benefits while maintaining investment flexibility during your lifetime.
Irrevocable Trusts: Including dynasty trusts, grantor trusts, and other structures that may provide estate tax advantages while holding alternative investments.
Family Limited Partnerships: These may offer valuation discounts for estate planning purposes while facilitating family alternative investment strategies.
Frequently Asked Questions
What is the minimum investment required to access quality alternative investments?
Alternative investment minimums vary significantly by strategy and fund. While some hedge funds or real estate syndications may accept $50,000-$100,000 minimums, institutional-quality private equity funds often require $1 million or more. Through our Fractional Family Office™, we help entrepreneurs access lower minimums through our established relationships and pooled investment opportunities.
How liquid are alternative investments compared to traditional portfolios?
Alternative investments typically have longer lock-up periods than traditional assets. Private equity funds may require 7-10 year commitments, while hedge funds might offer quarterly or annual liquidity. We help you design liquidity tiers within your portfolio to ensure appropriate cash availability while maximizing alternative investment opportunities.
Do alternative investments require active management or oversight?
Most alternative investments are professionally managed, requiring minimal day-to-day attention from you as the investor. However, ongoing monitoring of fund performance, manager changes, and market conditions remains important. Our team provides this oversight, allowing you to benefit from alternative investments without dedicating significant personal time to management.
How do alternative investments affect overall portfolio risk?
When properly diversified, alternative investments often reduce overall portfolio risk through non-correlation with traditional markets. However, individual alternative investments may carry higher risk profiles than stocks and bonds. The key lies in proper allocation sizing and diversification across multiple alternative strategies.
What happens to alternative investments during economic downturns?
Alternative investments often provide more stability during market volatility due to their non-correlated nature. However, performance varies by strategy—some hedge funds may generate positive returns during market declines, while private equity investments might experience temporary valuation decreases. The longer investment horizons of most alternatives help smooth short-term market fluctuations.
How does Dew Wealth help entrepreneurs access alternative investments?
Our Fractional Family Office™ provides comprehensive alternative investment access through our established relationships with fund managers, syndication sponsors, and other investment professionals. We conduct thorough due diligence, negotiate terms where possible, and provide ongoing monitoring and portfolio management. This institutional approach allows entrepreneurs to access alternatives typically reserved for much larger investors.
As Pete Vargas explains: "I had never seen a model for advisory in the way that they ran it. I have a Peace of Mind around my finances, my insurance, my assets protection, my taxes and all of that stuff because they're constantly working on my behalf."
Conversations, testimonials or case studies are for illustrative purposes only, not a real-world representation of events. Individual experiences may vary and should not be construed as a guarantee of similar results.
Taking the Next Step: Implementing Your Alternative Investment Strategy
For entrepreneurs ready to move beyond traditional investment limitations, implementing an alternative investment strategy requires careful planning and expert guidance. The billionaire approach to wealth building isn't just about having more money—it's about having access to the sophisticated strategies and professional teams that make these approaches successful.
Here's the uncomfortable truth: Most successful entrepreneurs will never access these opportunities through traditional advisory relationships. The structural limitations, knowledge gaps, and misaligned incentives simply won't allow it.
Our Fractional Family Office™ brings billionaire-level investment access to successful entrepreneurs without requiring billion-dollar minimums. Through our systematic approach, we help 7-9 figure business owners implement the same alternative investment strategies used by ultra-high net worth families.
The bottom line: You've already proven you can build wealth through your business. Now it's time to protect and grow that wealth using the same sophisticated strategies that have preserved generational fortunes for decades.
Immediate Action Steps:
- Complete our Wealth Waste Calculator to identify potential opportunities in your current investment approach
- Schedule a portfolio review to assess your current asset allocation against billionaire investment models
- Evaluate your liquidity requirements to determine appropriate alternative investment allocations
- Consider your investment timeline and risk tolerance for different alternative strategies
- Review tax implications of alternative investments within your overall wealth strategy
The path from successful entrepreneur to truly wealthy individual requires implementing the sophisticated investment strategies that billionaires have used for generations. Alternative investments represent a critical component of this journey, providing diversification, enhanced returns, and risk management benefits unavailable through traditional portfolios.
Whether your goal is preserving wealth across generations, generating passive income streams, or building a lasting legacy, alternative investments may provide the strategic advantages needed to Make Rich Real® in your entrepreneurial journey.
Disclosure
Dew Wealth Management, LLC ("Dew Wealth") is an SEC-registered investment adviser located in Scottsdale, Arizona. Registration does not imply a certain level of skill or training. The information provided in this material is for general informational and educational purposes only and should not be construed as personalized investment, tax, or legal advice. All investing involves risk, including the potential loss of principal.
This material discusses business management strategies and financial practices and is not intended to provide specific investment recommendations. The profit amplification strategies discussed represent general business concepts rather than specific investment advice. Implementation of these strategies does not guarantee improved profitability, and results will vary based on numerous factors specific to your business and market conditions. The financial team structures, cost estimates, and implementation strategies mentioned are for illustrative purposes only. Actual costs, appropriate team composition, and results will vary based on the specific needs and circumstances of each business. Dew Wealth does not guarantee that implementing these strategies will result in profit improvement or wealth creation. References to other professionals, such as bookkeepers, controllers, and CFOs, do not constitute an endorsement or recommendation of any particular service provider. Clients are free to work with professionals of their choosing. Case references and examples discussed in this material are presented to illustrate concepts and do not guarantee similar outcomes for other businesses. Forward-looking KPIs and measurement tools discussed represent commonly used business practices but may not be appropriate for all businesses and do not guarantee improved financial performance.
Dew Wealth's services are only offered in jurisdictions where the firm is properly registered or exempt from registration. When providing Fractional Family Office® services to clients, Dew Wealth maintains a fiduciary relationship and places clients' interests first. The firm's advisory fees and services are described in its Form ADV Part 2A, which is available upon request. By accessing, using, or receiving this Document, the Recipient acknowledges and agrees to be bound by the terms and conditions outlined at DewWealth.com/IP.
