Hindsight is 20/20, especially when it comes to investing. These savvy investors and Advisors in The Oracles share their best investments and the surprising lessons they learned from them.
1. I bought the same office building twice.
In 2005, I purchased a 12-story office building in Houston, Texas, for $12.7 million with 25% cash down. I spent $400,000 remodeling the lobby and rebuilding the exterior. I was able to sell it for $18 million in just under two years — before the market crash in 2008.
In 2011, I purchased the same property for $11 million while the market was bad. When the economy recovered from the recession in 2014, I sold it again for $18 million. Now I’m waiting for the next downturn in commercial real estate.
From 2004 to 2015 I bought and sold five similar buildings, twice with the same strategy. The moral of the story: Timing is everything. Wait for a recession, take your time and buy a distressed property with a lot of upsides. Then make money on the sale when the economy recovers. —Manny Khoshbin, president of The Khoshbin Company and author of “Contrarian PlayBook”; arrived in America at 14 almost homeless and now has a nine-figure net worth
2. I realized data is the new oil.
In 2013, a friend called me with a seemingly simple question: “What do you know about behavioral data?” This question led me to my best investment to date. Research revealed to me that data is the new oil. The difference? Instead of running low on it, we produce more data daily than all the global data created across thousands of years. And companies need this data to better serve their customers and remain competitive.
Knowing this, I hedged all of my bets on building and creating one of the largest, most robust people-based identity graphs available on the market. An identity graph helps connect consumers and their devices across all channels, so that companies can deliver a more personalized shopping experience. That dataset now powers some of the largest companies and advertising agencies in the country, generating billions of dollars. Although risky, that single investment resulted in over eight-figure returns annually. —Matt Mead, founder and CEO of Mead Technology Group, EpekData and BrandLync
3. I invested in blue-chip stocks during the market crash.
While many investors were panicking and cashing out during the stock market crash in March 2008, I saw an opportunity. I bought a significant position in Fortune 100 and blue-chip stocks — large companies with track records of success and attractive valuations. I invested around $1 million in shares of companies like FedEx, which were trading for about $38 at the time — well below where it was before the crash and where it is today, around $181 a share.
When the market gets weak, smart investors look for strong companies to ride out the storm. That long-term philosophy has always paid off for me. Blue-chip stocks generally have stable earnings. During an economic downturn, many investors like myself turn to them for security. But today, some of the most recognized blue-chip companies with long-lived names are not good investments. Some have been overinflated, are overextending, and may be on the brink of bankruptcy — making them a better stock to sell than buy.
To maximize potential earnings, trust your instincts, know what you can and can’t do with your portfolio, and never risk your entire nest egg. Don’t always move with the crowd. Sometimes, going against the obvious has the biggest payoffs. —Gail Corder Fischer, executive vice chairman of Fischer & Company, a leading global corporate real estate firm that provides consulting, brokerage and technology solutions
4. I took advantage of student loans and student housing.
The best investment I ever made was buying my first house in college, which paid for itself in less than 10 years. I’ve known since I was 13 that I wanted to get into real estate investments. As soon as I turned 18, I started working two personal trainer jobs and running nightclub events. Since I was so young, I worked for five years to save for the large down payment I needed.
That’s how I saved $50,000 by my second year of college. I lived in the house I bought and rented it to my three best friends. Once I saw the return on investment, I took out an interest-free student loan designed for living expenses so I could buy another house. Within a year, that $20,000 paid itself back because of the great ROI of student housing. I reinvested the profits into more houses in the area.
Even though I left England and moved to the U.S., I continue to rent those houses to students. They provide a 10 to 25% yield per year with minimal work. I’ve already recouped my initial down payments and nearly earned enough to pay off the houses in full. —Rudy Mawer, founder and CEO of ROI Machines and RudyMawer.com; Facebook marketing and ad expert, who built a multimillion-dollar business by age 26; connect with Rudy on Instagram
5. I bought another business and found my calling.
I made my best investment when I had a telecommunications company in the late 1990s. I acquired a competitor down the road for $1 upfront and grew by a year’s worth of sales in an afternoon. The deal itself wasn’t special — it was a 13-year-old mobile-phone retailer. But the value was immense and shaped my whole career.
I thought the only way to scale business was to invest blood, sweat and years. This deal shattered that paradigm. I realized you don’t have to run the marathon to win the race. You can just run the last 10 yards and still get the medal.
I’ve gone on to do over 100 mergers and acquisitions and counting. I also advise on many more via tactical seminars, and am doing two initial public offerings through our agglomeration platform. —Jeremy Harbour, investor and mergers and acquisitions expert; founder and CEO of Unity Group and Harbour Club; author of “Go Do!” and “Agglomerate: From Idea to IPO in 12 Months;” follow Jeremy on Twitter and LinkedIn
Disclosure: The above content references opinions and is for information purposes only. Nothing contained within it is intended to be investment advice. Investing is risky. Consult your independent financial advisor.