Loss Aversion? Really? Continuation from previous article...

Following up on my previous post (Overlooked New Investment Approaches), one could argue that the accuracy of the [experts’] formulations based [investments] vetting methodology should be considered suspect. Most angel investors, venture capitalists, private equity deal makers, and other financial experts rely on these time honored developed measurements to test multiple hypotheses to determine the viability of an investment opportunity, thus causing so many opportunities to be rejected.

I submit, that if the results of these methodologies were in fact so accurate, then why do we still see so many loss outcomes throughout the financial investments sector after so much prior vetting by these so-called “experts” has occurred. I do not suggest any ill-intent, simply that perhaps too many “experts” are reliant upon the previous prejudices of their former counterparts, i.e., group think. Removal of these invisible horse blinders via different training and considerations would result in different outcomes.

Or why is so much work put into these business opportunity's pitch presentations (e.g., Executive Summaries, Business Plans, Feasibility Studies, Executive Team’s past performance, etc.) only to later find that in many cases the business opportunity’s win and loss comparisons can too often be settled by a coin toss.

Shouldn’t more earnest measurement value be included in projecting outcomes? I submit that Passion must be considered along with all other variables and values. To ignore it would too often remove the IT factor, that necessary critical drive that any successful venture needs to keep itself out of the loss column.

Loss Aversion refers to an individual’s tendency to prefer avoiding losses as opposed to the acquisition of equivalent gains. This mentality can prevent individuals, corporations, and countries from making decisions to address complex challenges, despite many other positive variables to the contrary. Though risk-aversion is important, it can also prevent the implementation of many innovative solutions simply because they do not pass the muster of these formulations.

?Socially Responsible Investing (SRI) involves investing in companies that promote ethical and socially conscious themes while still keeping a keen eye on the potential for earnings. I have a client that is most passionate, even driven, about The “Investable” Child (article by Susan Prentice) and the economic reframing of childcare. My consulting with them at this stage of my life is evidence of my same belief. The metrics of this opportunity do not necessarily fit with current formulation based investment methodologies one might argue, obviously I disagree. The path toward the realization of this SRI opportunity will occur once equally passionate, socially responsible investors are located. Therefore, I present the following for your review and follow-up. Thank you for your indulgence.

RARE OPPORTUNITY - SINGLE-ISSUE SOCIAL IMPACT INVESTMENT

Seeking a limited group of 20 investors at $25,000 each who are RWA participants. If you believe and are passionate that Childcare should be subsidized 100% for the age groups of 0 through 5 on a National level and want to invest in a nationally driven campaign to get it done, look no further.

?THIS is an investment you should get behind with your dollars – your EARNINGS will be based on a sound formula used to promote and conquer this pressing societal issue. The political implications will vary without the usual conflict too often seen by those who agree or oppose, e. g., Bernie Bro’s, Dems, Progressives, Super-Liberals, Independents, the reasoned wealthy and even today’s more logical Moderate Republicans will find this investment appealing.

?PS: You must have a visible Social Media presence (Twitter, FB, Instagram or LinkedIn) in order to be vetted and approved. Ideal for politically and socially active and concerned persons. Your 1% of the company’s projected minimal Earnings is an estimated $25K per year and your exit is allowed after a one (1) year commitment.

?Contact company Consultant for further details at: [email protected].

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