6A – Identifying Opportunities in Economic & Regulatory Trends
- Aging population will increase demand for long-term senior care
- Where did you find this? This is something I have been aware of for a while, but I did additional research and confirmed this using data from the U.S. census.
- What leads you to believe this opportunity might exist? As people age, their needs change, and many need long-term care from a dedicated professional staff. Compounding this effect is the fact that the Baby Boomers and Gen-X had less children (i.e. caretakers) than previous generations, implying that their late-life care will have to be outsourced to professionals.
- Who do you think is the most likely customer? People 60 and over with access to long-term benefits or sufficient retirement savings.
- Is the opportunity easy or difficult to exploit? It is fairly difficult, as you have to raise substantial capital to build a senior living facility.
- Why did you see the opportunity? I worked for a summer with a senior facility, so I have been aware of trends in the market.
- Millennial's who haven't purchased homes will do so in the next 10 years at rapid rates, increasing the value of housing in urban centers
- Where did you find this? First I hypothesized it, but I confirmed this with sources such as CNBC which site millennial's as the largest portion of the population buying homes in 2019 and 2020.
- What leads you to believe this opportunity might exist? My own observation of the market and my personal life- most people believe owning a home is important to financial security. If people have not yet purchased their first home, they will eventually.
- Who do you think is the most likely customer? People born between 1985-1995 who have stable jobs and are involved in long-term relationships.
- Is the opportunity easy or difficult to exploit? It depends on how you approach it. You could purchase a REIT which would give you exposure to specific sectors of the real-estate market. Or, you could open a real-estate firm marketed towards millennial's.
- Why did you see the opportunity? I myself am looking into ways to buy houses, and I noticed many of my peers who have not participated in the market are starting to do so.
- The Trump administration has rolled back Dodd-Frank regulations that make it easier for non-banks to lend money
- Where did you find this? Independent research on how Dodd-Frank reforms effect non-bank financial institutions.
- What leads you to believe this opportunity might exist? Non-Bank Financial Companies have several advantages over Chartered Banks, notably they don't have to comply with reserve ratios set my the federal reserve. This means that they can lend at lower rates or lend more of their portfolio. They can also lend to riskier institutions (start-ups, early stage entrepreneurial ventures) because they don't have to comply with stress-tests like chartered banks do.
- Who do you think is the most likely customer? People in need of specialty financing who are unable to secure a loan from a traditional bank.
- Is the opportunity easy or difficult to exploit? The easiest way to exploit this is to secure a loan from a NBFC (Non-Bank Financial Company) in order to start a business. A more difficult way would be to start your own NBFC.
- Why did you see the opportunity? I work for a tech company that works closely with NBFC's, and so I was researching trends and changes in the market as part of my job.
- Regulation of fracking in the U.S. would cause substantially higher prices for fuel and gas
- Where did you find this? Independent research (Energy Information Administration) which shows that fracking makes up a substantial portion of U.S domestic production of oil and gas.
- What leads you to believe this opportunity might exist? Multiple presidential candidates have publicly said they would out-right ban fracking on public land. The general public also has a negative view of fracking.
- Who do you think is the most likely customer? Anyone in the U.S. with disposable income to invest into any type of renewable energy infrastructure.
- Is the opportunity easy or difficult to exploit? Fairly difficult. I think the best way to exploit this would be retail sale of solar panels. This would require you to organize a company and hire employees to become a distributor of solar panels.
- Why did you see the opportunity? I worked in the Energy sector of an investment fund. I have been aware of this regulatory trend for several years.
- Where did you find this? This is something I have been aware of for a while, but I did additional research and confirmed this using data from the U.S. census.
- What leads you to believe this opportunity might exist? As people age, their needs change, and many need long-term care from a dedicated professional staff. Compounding this effect is the fact that the Baby Boomers and Gen-X had less children (i.e. caretakers) than previous generations, implying that their late-life care will have to be outsourced to professionals.
- Who do you think is the most likely customer? People 60 and over with access to long-term benefits or sufficient retirement savings.
- Is the opportunity easy or difficult to exploit? It is fairly difficult, as you have to raise substantial capital to build a senior living facility.
- Why did you see the opportunity? I worked for a summer with a senior facility, so I have been aware of trends in the market.
- Where did you find this? First I hypothesized it, but I confirmed this with sources such as CNBC which site millennial's as the largest portion of the population buying homes in 2019 and 2020.
- What leads you to believe this opportunity might exist? My own observation of the market and my personal life- most people believe owning a home is important to financial security. If people have not yet purchased their first home, they will eventually.
- Who do you think is the most likely customer? People born between 1985-1995 who have stable jobs and are involved in long-term relationships.
- Is the opportunity easy or difficult to exploit? It depends on how you approach it. You could purchase a REIT which would give you exposure to specific sectors of the real-estate market. Or, you could open a real-estate firm marketed towards millennial's.
- Why did you see the opportunity? I myself am looking into ways to buy houses, and I noticed many of my peers who have not participated in the market are starting to do so.
- Where did you find this? Independent research on how Dodd-Frank reforms effect non-bank financial institutions.
- What leads you to believe this opportunity might exist? Non-Bank Financial Companies have several advantages over Chartered Banks, notably they don't have to comply with reserve ratios set my the federal reserve. This means that they can lend at lower rates or lend more of their portfolio. They can also lend to riskier institutions (start-ups, early stage entrepreneurial ventures) because they don't have to comply with stress-tests like chartered banks do.
- Who do you think is the most likely customer? People in need of specialty financing who are unable to secure a loan from a traditional bank.
- Is the opportunity easy or difficult to exploit? The easiest way to exploit this is to secure a loan from a NBFC (Non-Bank Financial Company) in order to start a business. A more difficult way would be to start your own NBFC.
- Why did you see the opportunity? I work for a tech company that works closely with NBFC's, and so I was researching trends and changes in the market as part of my job.
- Where did you find this? Independent research (Energy Information Administration) which shows that fracking makes up a substantial portion of U.S domestic production of oil and gas.
- What leads you to believe this opportunity might exist? Multiple presidential candidates have publicly said they would out-right ban fracking on public land. The general public also has a negative view of fracking.
- Who do you think is the most likely customer? Anyone in the U.S. with disposable income to invest into any type of renewable energy infrastructure.
- Is the opportunity easy or difficult to exploit? Fairly difficult. I think the best way to exploit this would be retail sale of solar panels. This would require you to organize a company and hire employees to become a distributor of solar panels.
- Why did you see the opportunity? I worked in the Energy sector of an investment fund. I have been aware of this regulatory trend for several years.
Hi Zach,
ReplyDeleteIt seems like the articles you found all correlate with the housing market/senior living. I think it is really effective to have all of these articles in mind when you are reflecting on your opportunity. The information provided by these articles can help you decide whether or not it would be a lucrative business. From the information provided, I personally think it would be worth it for you. It looks like the housing market is increasing demand and money will be easier to get so all I see is opportunity.
Hi Zach! Great points about the aging population. In many places, especially Florida, there is an opportunity to improve senior living as people continue to age longer. In many retirement communities, proper networks aren't set sup for assisted living or healthcare. This may be a good opportunity for real estate developers, and the health care system, to develop areas that can better accommodate seniors.
ReplyDeleteHi Zach. Nice job identifying opportunities. I think you identified some issues that will definitely affect current businesses, as well as, future business opportunities. The aging population will definitely change our economy in the near future.That will present many opportunities. The removal of Dodd-Frank regulations will also have a big impact on the economy. Also, your article is easy to read and understand. Good job!
ReplyDelete