Private Equity Best Practices: Opportunity Zones: A Path to Economic Revitalization – Part 2

Opportunity Zones: A Path to Economic Revitalization – Part 2

Evaluating Opportunity Zones for Investment

When considering investment opportunities within Opportunity Zones, it’s crucial to conduct thorough due diligence. Factors such as location, market demand, economic indicators, and local development plans should be carefully assessed. Engaging with experienced professionals, such as real estate developers, financial advisors, and tax experts, can provide valuable insights and mitigate risks.

Additionally, it’s important to align investment goals with the unique needs and characteristics of each Opportunity Zone. Some zones may present greater potential for growth and positive impact, while others may require additional resources and support to unlock their full potential. By conducting a comprehensive analysis, investors can make informed decisions that align with their investment strategies and social objectives.

Case Studies: Successful Opportunity Zone Investments

To illustrate the impact of Opportunity Zone investments, let’s explore a few case studies that highlight successful projects in different sectors:

Affordable Housing Development

In an Opportunity Zone in a major urban area, a real estate development group partnered with a QOF to develop affordable housing units. Through the tax advantages provided by the Opportunity Zone program, the project was able to secure financing and offer high-quality housing at affordable rents. This investment not only provided much-needed housing options but also contributed to the overall revitalization of the community.

Technology Start-up Incubator

In another Opportunity Zone, a venture capital firm established a technology start-up incubator to support local entrepreneurs. By providing mentorship, funding, and workspace, the incubator created an environment conducive to innovation and job creation. This investment helped foster a thriving technology ecosystem within the community, attracting talent and driving economic growth.

Infrastructure Development

A private equity firm partnered with local government agencies to invest in critical infrastructure projects, such as transportation and utilities, in an Opportunity Zone. This investment facilitated the expansion and improvement of essential infrastructure, stimulating economic activity and attracting businesses to the area. As a result, the community experienced increased job opportunities and enhanced quality of life.

Sports Industry Opportunity Fund

A sports industry opportunity fund is a type of investment vehicle that focuses on opportunities within the sports industry. These funds pool money from multiple investors and allocate it to various projects, companies, or ventures related to sports, such as sports franchises, stadium development, sports technology startups, sports media, merchandising, and more.

The goal of these funds is to generate returns for investors by capitalizing on the growth and potential of the sports industry. They may target both traditional sports sectors like professional leagues and teams, as well as emerging areas like esports, sports betting, and sports tech.

Investing in a sports industry opportunity fund allows investors to gain exposure to the sports market without having to directly manage individual investments. These funds are typically managed by professionals with expertise in both finance and the sports industry, who identify promising opportunities and make investment decisions on behalf of the fund’s investors.

Benevolent Capital

At Benevolent Capital we have carved a niche for our investors by seamlessly blending traditional family values with cutting-edge investment strategies. Our approach is characterized by a thoughtful fusion of innovation and prudence, ensuring that every investment aligns with the long-term vision and legacy goals of our clients.

As principals we co-invest our own money in every deal we participate in, we do not charge our investors management fees, investors receive a 100% preferred gross return on their investment. After the 100% return (a 2X) the investor will receive a 70% net return with a 30% promote to the GP. This arrangement makes Benevolent Capital a trusted partner in safeguarding and growing wealth for our investors.

Benevolent Capital includes a world-class group of partners, associates and investors, and our portfolio now spans catalytic investments in venture capital, private equity, real estate development and a diverse collection of global professional soccer franchises. Our wide range of experience from managing successful companies, to completing management buyouts, acquisitions, and a wide variety of debt and equity investments totaling over $4 billion enables us to truly partner with the entrepreneurs and management teams of our portfolio companies and provide hands-on support and guidance towards realizing their full potential. Benevolent Capital has a proven track record of successful investments. Notably, our $200k investment in seed capital for Enzymatics, a biotech firm later ultimately acquired by Invitae (NASDAQ: NVTA), has yielded over $30MM in total returns for Benevolent Capital’s investors.

What sets us apart is not just our financial acumen but also our dedication to fostering meaningful relationships. Going beyond conventional investment practices, we prioritize open communication and transparency that allows us to build trust with our stakeholders, as principals we co-invest our own money in every deal we participate in making Benevolent Capital a trusted partner in safeguarding and growing wealth for our investors.

In an ever-evolving financial landscape, our expertise, coupled with Benevolent Capital’s commitment to hybrid family office investments, paints a picture of success, where financial prosperity meets enduring values.

About the Author

Brett M. Johnson, founder and CEO of Benevolent Capital, founder and partner of Fortuitous Partners, and co-founder and chairman of Rhode Island FC. He has a bachelor’s degree from Brown University and a Masters of Business Administration from the Presidential/Key Executive program at Pepperdine University. Brett is also a graduate from the Harvard Business School’s President’s Leadership Program in 2014. An active member of the Young Presidents Organization.

Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Always consult with a qualified financial advisor or wealth manager before making any investment decisions.