This may be the most shocking chart you’ll see this year.
Over the past two decades, nearly half of the publicly traded companies in the U.S. have vanished…
According to the World Bank, the number of U.S. listed companies dropped from a high of 8,090 in 1996 to 4,744 at the end of 2019.
But it’s not just the World Bank seeing this…
The Wilshire 5000 Total Market Index is the oldest measure of the entire U.S. stock market.
When the index launched in 1974, it had 5,000 stocks. It grew as high as 7,562 in 1998. But by the end of 2019, the index had been cut by more than half – to 3,473.
This trend isn’t set to reverse, either. Global consulting firm McKinsey & Company projects 75% of S&P 500 companies will disappear over the next decade.
So what’s causing so many U.S. companies to disappear?
The answer isn’t China… technology… or changing demographics.
Today, I’ll tell you what’s behind the demise of the publicly listed company – and more importantly, how you can profit from it.
The Incredible Shrinking Stock Market
The main reason we’re seeing fewer publicly listed companies is because they’re staying private much longer.
As you can see in the chart below, in 2018, the average company stayed private for 13 years – over three times longer than in 1999.
The main reason companies are staying private longer is because it’s more profitable for them. And when they eventually go public, they’ll do so at much higher valuations.
As you can see in the chart above, from 1999 to 2018, the average market cap of private companies at IPO has jumped 294%.
For mom-and-pop investors, it’s a double whammy. There are fewer public companies to choose from (meaning fewer opportunities to make profits). And buyers pay a lot more for companies when they go public.
Meanwhile, early investors laugh their way to the bank. They’re making big profits by off-loading private companies with massive valuations onto an unsuspecting public.
But at the Daily, we show you how to turn the tables on Wall Street’s elite…
So if you really want to build your wealth, you’ll need to consider investing in private equity. But until recently, the elite walled off this $5 trillion market from ordinary investors.
Today, that’s all changed. And I’ll show you how anyone with $500 – or less in some cases – can get into this growing market…
Invest in This Growing Market
According to McKinsey & Company, the private market has over $5 trillion in assets under management. So private companies can easily raise capital without going public.
And it’s paid off…
Over the last 20 years, the U.S. Venture Capital – Early Stage Index has returned an average of more than 86% per year. Yet most of the well-known stock indexes – like the S&P 500, Nasdaq, and Russell 2000 – have returned an average of less than 7% per year.
That’s not a typo. Early stage, private companies have returned over 12x what public companies have during the past two decades.
And now, new rules from the Securities and Exchange Commission allow ordinary investors to get in the game and invest in private companies before they go public…
They’re called Regulation CF and Regulation A+ offerings. The main difference is in the amount of money each can raise. Regulation CF offerings can raise up to $1 million from the public. And Regulation A+ offerings can raise up to $50 million.
You can often invest in a Reg CF offering with as little as $100. And minimums for Reg A+ deals generally range from $250–1,000.
Here’s what Daily editor Teeka Tiwari recently had to say about private deals:
Venture capital firms have used them for years to make 10, 100, and even 1,000 times their money.
Now, you can search for private deals yourself on crowdfunding platforms like SeedInvest and MicroVentures. They list dozens of startup companies raising money from the general public.
For massive gains, it’s essential to have an allocation to the private markets. So consider creating your own portfolio of 10–12 startups. You just need one of them to hit it big to make life-changing gains.
But remember, this asset class comes with risk. So a small grubstake is enough. We recommend a total allocation of up to 5% for private markets.
Regards,
Grant Wasylik
Analyst, Palm Beach Daily
P.S. Teeka’s personally amassed a fortune with just this one type of investment. And he believes that almost anyone can do the same.
Now that it’s legal, the time could not be better to learn how you can get started with something that used to be set aside for Wall Street insiders.
And Teeka’s already found a sweetheart deal for the public. He’s put the details in a special report called, The Next Monster.
And right now, you can buy shares for pennies. But don’t delay. Learn how you can get your copy right here.