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Trends #0041 โ€” Alternative Assets

๐Ÿ” Problem

Mainstream assets (stocks, bonds, real estate) tend to trade in efficient markets. It's hard to find an edge when others have the same access and information.

๐Ÿ’ก Solution

Alternative assets (tax deeds, sports cards, fine art) have access and information problems. They may be illiquid, volatile, hard to authenticate and value. But every problem presents an opportunity.

๐Ÿ Players

  1. Wine
  2. Watches
  3. Art
  4. Facebook Groups
  5. Music Royalties
  6. NFTs
  7. Instagram Accounts
  8. Domain Names
  9. Whisky
  10. Spotify Playlists

๐Ÿ”ฎ Predictions

โ˜๏ธ Opportunities

๐Ÿ”‘ Key Lessons

๐Ÿ˜  Haters

"You still haven't defined an alternative asset."

It's easier to define what it's not. An alt is not easily accessible (stocks), easily understandable (residential real estate) or mainstream (bonds). These tend to be hard to access (Birkin bags), understand (synthetics), illiquid (vintage cars) or new (NFTs).

"All of these assets are liquid."

Be careful with absolutes. Liquidity, to me, means that you can quickly buy and sell without taking a 30% haircut in fair market value. Sure, fire sales do happen.

"Non-cash-flowing assets can be a great store of value."

This implies stability. If that holds true, sure.

"It's against many terms and conditions to sell social media accounts."

Big and small players wrap an account in an entity and sell the business. Not the account.

"Facebook, Instagram and Spotify? What about platform risk?"

Factor platform risk into your price.

"Influencers affecting prices is immoral and illegal."

Maybe. Maybe not. It's also inevitable and hard to control. "Social investing" platforms like Public, Robinhood and Twitter put us in the age of shilling.

"Is this financial advice?"

No.

"Alternative asset classes are missing."

There are 50 more in Trends Pro.

๐Ÿ”— Links

  1. Who should I talk to about alternative assets?: The tweet behind this report.
  2. Micro Private Equity: A report on buying and selling some of these alternative assets.
  3. Drop Culture: A look at what drives the price of non-cash-flowing assets.
  4. Equity Crowdfunding: The force behind fractional ownership platforms.
  5. DeFi: Decentralized finance will disrupt auctions, marketplaces and governments.

๐Ÿ“ˆ More Reports

Join 30,000+ founders discovering new markets and ideas:

Or go here to get the Trends Pro report. It contains 300% more insights. You also get access to the entire back catalog and the next 52 Pro Reports.

  1. 2

    The content is great, but the subscription box at the end is "WOW"!
    How did you do this?!

  2. 2

    As usual, very well articulated. Concise but sufficiently detailed while remaining interesting and thought provoking. I almost always share these posts/pieces/topics with someone in my network with whom I want to discuss the topic - using the content as a conversation starter. ๐Ÿค˜๐Ÿค˜

    1. 2

      Thanks for the support Dante!

  3. 2

    Alternative assets, like everything else, are being democratized. See code vs no-code, newspapers vs newsletters and IPOs vs ICOs.

    This is the big takeaway for me. The market keeps surprising me with how many different industries and behaviors can be democratized.

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