Investments with High Returns

Generally, there are various types of investments that we could consider. However, 5 Pillars would like to focus only 3 types of investments which we believe could potentially generate top-notch returns as mentioned below:

1. Early Stage Financing

Early-stage financing has 2 subdivisions; start-up financing and first stage financing.

  1. Start-up financing is given to companies to finish the development of products and services.

  2. First Stage financing: Companies that have spent all their starting capital and need finance for beginning business activities at the full-scale are the major beneficiaries of the First Stage Financing.

2. Expansion Financing / Growth Capital 

  1. Expansion financing may be categorized into second-stage financing, bridge financing, and third stage financing or mezzanine financing.

  2. Second-stage financing is provided to companies to begin their expansion. It is also known as mezzanine financing. It is provided to assist a particular company to expand in a major way.

  3. Bridge financing may be provided as a short-term interest-only finance option as well as a form of monetary assistance to companies that deploy the Initial Public Offers as a major business strategy.

3. Fund of Funds 

  1. A “Fund of Funds” (FOF) is an investment strategy whereby investments are made in other funds rather than directly in securities, stocks, or bonds. By investing in a fund of funds, investors are granted diversification and the ability to hedge their risk by investing in various fund strategies. 

  2. FOF helps to spread the risk of the investments made whilst maintaining healthy returns. Smaller investors, who do not have access to larger private equity funds due to capital constraints, often invest in FOF to increase their exposure to the asset class. 

  3. Besides, because of its size and diversification, a FOF has the potential to offer less risk than an individual Venture Capital investment. One of the most important advantages of a high-quality FOF can be summed up as access to high-quality funds with proven managers, maximum diversification, and cost-effectiveness.