In this latest episode of Minority Business Access, host Solomon RC Ali explains how the stock market works, the right and wrong ways to pick your stocks, why acquisitions (or roll ups) fail or succeed, overcoming stock fear, how to take a company public when an IPO is not on the table, and the difference between buying a stock directly from a company versus buying the stock “retail.” Tune in to this episode to the how the stock market really works.
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How The Stock Market Really Works
It’s going to be an exciting 2021. We’re all coming out of 2020 and it was a tough year with COVID-19. A lot of companies and business owners suffered going out of business and struggled, even with the government’s help and assistance. 2021, hopefully, will be a lot more promising than 2020. What we’re going to try to bring now is we’re going to talk about more on our show about investing, individual investors looking for investments and what type of investments. There are some people out there like myself who are looking to be a part of roll-ups, finding the right companies to assist them in rolling up companies within their industry, which is very exciting.
If you’ve never been a part of a roll-up and things like that or a company growing and expanding through roll-ups or acquisitions, it’s something that you should be a part of, in my opinion. I want you to keep this in mind. Most acquisitions don’t work out. They ended up failing before one reason or the other. The most common reason that they fail is because of the cultures are not able to blend together. The second most common is probably the duplications. They don’t provide the cost savings and cuts that they thought it would bring. The third is that the management team is not able to execute the way everyone hoped for and the way they had planned. There are a lot of other reasons taking place. Those are the three reasons I believe are the most common.
What you got to do is figure out, “Where do you want to be as an investor? What do you want to invest in? Why do you want to invest in it?” You all heard Warren Buffett and other top investors say this, “Invest in something that you know. Invest in something that you like. Invest in something that you understand.” That’s what we try to do at RC Ali Corporation. If you go to our website, SolomonRCAli.com, you’ll find that we’ve done the due diligence work for you in looking at various companies. We’re not promoters, market makers or broker dealers. We’re not trying to push you to buy a stock, pump up a stock or a company for you to buy. That’s not what we’re trying to do.
Before you invest in stocks, invest in the company.
Invest In The Company
What we’re trying to do is educate people, hardworking people, who have a few dollars to invest to make the proper investment and not be throwing their money to chance. There are too many people just throwing their money to chance and not understanding investing. What you have to do is, one, don’t invest in stocks. What do I mean by that? Invest in the company. The company may have stocks for you to invest in, but before you invest in the stock, please invest in the company. Do your due diligence. Do your homework. Get to know the company. Get to understand whether or not it’s an industry you like or understand. Understand where that industry is going.
Look at the company. See if it’s a company that you like, a company and a business that you understand. Is it doing the things that fit your value systems? How has management performed in the past? How do you believe they’re going to perform in the future compared to all their competitors? What are the top companies in that industry doing? How does management in the company compare to those other companies in the industry? Are they planning on bringing something new to the table, new to the industry to get everything going?
When I say, “Don’t invest in the stock. Invest in the company,” these are the things that are important. One, it also helps you to get over any fears that you may have about investing and what may happen in the long run. It also gives you a level of confidence. It will give you some security in the sense that you have done your homework, you know what’s going on, you can stand your position and you can stand it with confidence and assurance. No matter what’s going on, the rumors, when PRs come out, whether they’re good or bad, you’re not turning around and going like the trees and the wind blowing whichever way. You’re standing fast because you’re like the root of the tree. You did your due diligence. You know what’s going on with the company. You believe what the management can do. You compared them historically. You looked at their information. You looked at their charts and things like that. That’s the type of investment we’re going to be looking at.
There’s a funny saying here by Paul. It’s like, “Are you going to want to watch paint dry? That’s what you should be doing when you invest.” It shouldn’t be a wild roller coaster ride. You should be making an investment in something and then you forget about it. You are not worried about it because you already did the homework on the front end. When people say, “The stocks have gone up 300%,” you’re like, “Okay,” because you’ve done the investigation, you know and that’s what you were expecting anyway. If somebody says, “It’s down 300%,” you’re not fazed by it because you have done your homework. When you have done your homework in something, you know 2 plus 2 is 4. No one can sway you one way or the other, so you’re not blowing in the wind like the leaves on the tree. You know and stand in your position with confidence. That’s what we’re going to talk about pretty much, is how to invest, why to invest. We’re going to try to watch the grass grow. How about that? Let’s get to the video.
“In the 1600s, the Dutch East India Company employed hundreds of ships to trade gold, porcelain, spices and silks around the globe, but running this massive operation wasn’t cheap. In order to fund their expensive voyages, the company turned to private citizens, individuals who could invest money to support the trip in exchange for a share of the ship’s profits. This practice allowed the company to afford even grander voyages, increasing profits for both themselves and their savvy investors.”
This is the important thing. Here’s the difference of getting in as a retail investor and getting in on the early stages. When you get in on the early stages, the ship owner, think of that as your business. He goes to the potential shareholders. All the shareholders invest in the company. When are they doing it? In the early stages. When you invest in a company in its early stages, that’s when you get the high-high returns. If you invest after it is already a retail company, your returns are minimized. That means the company has to do a whole lot more to perform to deliver the type of returns you’re going to need to get a good return on your investment. It’s a lot harder for them to do. That would be equivalent to a high school team playing a college team in football and you’re expecting the outcome for that high school team to win. It’s not going to happen.
That’s what you’re looking at. You’re the owner. You’re going to shareholders, potential investors. They’re investing. They’re sharing in the profits. What profits? Your growth. You as the owner have already shown that you have the ability to run and manage the business. You’ve shown that to operate the business. If you have read one of the books that I recommended, which is The Richest Man in Babylon, it talks about the various principles. One of those principles is, “I would not go to a brickmaker for him to go buy me jewelry. I’m going to lose my money. I’m going to go to a jewelry guy for him to buy me jewelry. If I want bricks done or a house built, I’m going to go to the brickmaker for him to do that.” In other words, you’re getting people and you’re investing in people who are skilled in their craft, skilled in what they do.
When we invest in a company, we’re looking for the management team to be skilled in what it does. We’re looking for the CEOs and the other VPs to be skilled in what they do in managing and leading. We’re looking for them to have that network of professionals working with them to give them the transparency in their books and records in their transaction. That’s extremely important because what we’re gauging when we do our due diligence is we’re looking at historical information to try to map out what may happen in the future.
If you’re like me and you want to invest in the company or you’re a new investor, here’s what you’re going to do. “I want to invest in this company, but what am I investing in? I’m investing in the growth of the company. I’m investing in this owner going out, getting another ship and doing more routes. I can feel confident in this owner being able to do that because he’s running an existing business that’s already successful. He only needs your money and my money to expand so he can do more and more of the same.” I want you to picture this as the company, as the owner, picture yourselves, as the shareholders, as that company go out and does its thing and looking to grow and expand. You as the shareholder, you’re receiving a piece of the profits on each and everything that takes place through what we call shares.
“They’re savvy investors, selling these shares in coffee houses and shipping ports across the continent. The Dutch East India Company unknowingly invented the world’s first stock market. Since then, companies have been collecting funds from willing investors to support all kinds of businesses. Now, the stock market has schools, careers and even whole television channels dedicated to understanding it, but the modern stock market is significantly more complicated than its original incarnation. How do companies and investors use the market now? Let’s imagine a new coffee company that decides to launch on the market. First, the company will advertise itself to big investors. If they think the company is a good idea, they get the first crack at investing and then sponsor the company’s initial public offering or IPO. This launches the company onto the official public market, where any company or individual who believes the business could be profitable again.”
What we’re talking about is the innate stages, not the innate stages of the company but the innate stages of the company ready to go public, a transformation from a privately ran company to a public company. What does that mean? A private company is only a company that have a handful of shareholders who have invested in it. It could be the owner and the founder himself. It could be the owner, the founder, his family and his friends. They will have the biggest opportunity for the biggest reward because they were in the earliest. The next phase is before they go public, there’s a round. Now, they get to come in and take in money because they need the money so that they can do this and do some more of their expansion plan before they go public.
If someone tells you there’s a secret to investing and making a lot of money, run the other way and don’t look back.
There’s another round normally right after they go public. It’s so early in the retail stage of that company heading the market. Normally, this is after a reverse merger or an initial IPO. You will see the stock take off and do some wonderful things. The earlier you get in and that you can get in, the more money you will make in the long run. As the company seasons, let’s say it’s been on the stock exchange or some type of platform for a year or more, what’s going to happen is it levels off. When it levels off, the company has to do more and run harder to make a difference. To move their stock price up, they got to run harder and do more. That’s going to be a little bit more difficult.
In the beginning, when the family and friends come in, all they had to do is to get the company up. Whatever their idea or the concept was, get it going and working. It’s not too hard. The next thing they had to do is, when they are ready to go public after they have proved their model, to get more people to invest in them. Those people typically want to invest in them because they’re looking at the previous model that they have and they know, “This guy knows how to make bricks. He can do this.” I’m investing with someone who understands. What they’re doing is that, “This guy knows how to make bricks, so I’m investing with someone who understands.”
When you look at it, here’s what’s happening. The owner is taking their company public. You want to get in, please understand at Solomon RC Ali Corporation, we say this, “ABCs, we help to arrange capital and funding for business. Whether that’s through financing of debt or equity, we help companies arrange their financing so they can grow and live their dreams out or we help investors such as yourself, such as myself, to invest in a company in its early stages so that they can get the huge returns.” That’s how we win. When we invest in the early stages right before the company goes public and right after it is public, we’re in there. We’re doing our thing. That’s where you see those huge returns.
We don’t do none of this without investigating the company. What does that investigating mean? We’re doing our homework. We’re researching on the company. We’re looking at all the historical information we have on the company. We’re looking at all the historical information on the industry. We’re looking up everything we can find on management. We’re looking at all the different type of third-party information from analysts and people writing PRs about the industry. We’re looking at all of this and we’re just putting it together like a puzzle so that we can have a good idea of how this company has performed.
Now, they’re coming to us so that we can invest. When we invest, we’re going to share in all of that growth. Let’s say the company might be worth $10 million. Let’s say we give them $10 million. The company is going to go out and do. Let’s say they go from being worth $10 million and we gave them $10 million also to being worth $100 million. We, as the investors, get to share in all of that $100 million company. When we initially invested in that company, it was only worth $10 million. We, the investors, you and I, lent the company more money to go out and fulfill its dream and vision. We were comfortable with loaning it more money or investing in it more money. Why? It’s because we did our homework and due diligence. They did it. They grew to $100 million. We share in the success.
IPO, Initial Public Offering that is not the only way to go public. You can do what’s called a DPO It is a Direct Public Offering. That means that the company itself goes public by itself without an investment banking house, underwriters, market makers. It will be more challenging for them to do that, but they can do it. It will be an uphill battle, but they can do it. That’s a direct public offering. That will be a little riskier if you’re going to invest in that because you don’t have the support of all the market makers making a market in the stock, but it can be done. When they do an initial public offering, you have the investment banking house underwriting the deal, arranging the capital and also assisting in talking to their network and making a market for the stock. That’s the difference there.
One of the favorite things that I like to do and you’ve probably been hearing of it a lot is a SPAC. I’m not going to talk about SPACs right now. That’s a Special Purpose Acquisition Company. I also like what we call reverse mergers. It is taking a legal entity, which is a privately held company, and merging it with a public legal entity, which is a company that is already public, but it doesn’t have the operations. You can take a company that is private, that has great operations and management and everybody is doing it. It hits on the things that we like for it to hit on. What are those things? Good management. They can do their job. Double-digit or triple-digit growth. Most professionals are going to say double-digit growth. I’m going to always say triple-digit growth is extremely important. Please don’t forget that. You’re looking for an industry that business is in that’s going to climb and continue to climb. You’re also looking for that management team to re-invest their capital in the growth of their business.
Those are the things that you’re looking for. We take that. We merge it with a public company, which doesn’t have an operation. Now, you have what we call T&T, at least in my opinion, because you have a publicly traded company that typically goes up in value in its stock price almost immediately in most scenarios, not always, but almost every time it goes up in value just for merging the two together. You instantly are going to see a return on your investment, especially if you’re in on the early stages, before the reverse merger or after the reverse merger. You make a lot of money. Here’s where people will make anywhere from 300% to 3,000% return in a very short period of time. I’m not going to qualify what a very short period of time could be. It could be a few months. It could be a few years. It is typically in a very short period of time.
It doesn’t always work out that way. That’s very important for you to all know, but you will know it if you do your homework prior to. In a case scenario like that, you’re going to have to do your homework on the company definitely before it merged because it might drag the stock price down. Typically, the stock price would go up because let’s say if the stock price was trading at $2 a share and it didn’t have an operating company and you bring this phenomenal operating company and place it inside, the stock price is probably going to go to $2.50, $3, $4 a share. You just made money that easy like turning on the lights.
That’s what you want to do, that’s the best way to invest, that’s the way I like to invest. It doesn’t matter what the industry is. It doesn’t matter if they are the New York Stock Exchange, NASDAQ or whatever. We like to do it with small-cap companies. We like to do it with our own penny stock companies because you get the greatest returns. You get the greatest volatility. You get a lot of rewards in sharing and helping that company go from maybe 1 location to 50 locations. A company could have 50 locations and you’re helping them go to 200 locations. You get a lot in return for sharing in the growth and investing in those types of situations. We’re going to go ahead and continue.
If you’re thinking about investing, you will be remiss if you do not go to SolomonRCAli.com and look up some of the things that we are doing, not for you to take our advice on investing in that particular company because we’re not market makers, broker dealers or promoters. We’re not trying to promote a company we were working on arranging capital. We’re trying to educate you on the process or how it’s done. We’re trying to save you some time that you will know exactly what to look for when you’re looking for a company because you might want to go over here and look at XYZ company. When you go look at XYZ company, you can take the ABC company we just did as a model and go look over here. Some of you who don’t have a whole lot of time are going to say, “ABC looked good for me. They did all the homework and everything. I’m good.” I can’t speak for you, but that’s what I would do. Time is money. We got to keep this moving along.
No Crystal Ball
“Buying stocks makes those investors partial owners in the business. Their investment helps the company to grow. As it becomes more successful, more buyers may see potential and start buying stocks. As demand for those stocks increases, so does their price, increasing the cost for prospective buyers and raising the value of the company’s stocks people already own. For the company, this increased interest helps fund new initiatives and also boosts its overall market value by showing how many people are willing to invest in their idea. However, if for some reason, a company starts to seem less profitable, the reverse can also happen. If investors think their stock value is going to decline, they’ll sell their stocks with the hopes of making a profit before the company loses more value. As stocks are sold and demand for the stock goes down, the stock price falls and with it, the company’s market value. This can leave investors with big losses unless the company starts to look profitable.”
There is no crystal ball to know which company is going to do phenomenal. There just isn’t. I wish there was. There’s no magic secret. If someone tells you there’s a secret to investing and making all this money, run the other way and don’t look back. In fact, don’t even talk to that person again because they’re blowing the smoke up your butt or maybe they had it blowing up their butt. There’s no secret. You have to do your homework. You have to investigate the industry, company and management team. Can they do the job? Even if they had past failures, what did they learn from their past failures? Some people have past failures and they come out on the other side, brighter and smarter because they learned something from it.
You got to determine that for yourself. You are making a judgment call. You’re the teacher. You’re determining what grade you’re going to give them. You got to do the work. When you do that work, or if you do not do the work, you have no one to blame but yourself because you just threw your money out there. You basically flushed it down the toilet. Who can you blame for flushing it down the toilet because you were too lazy to do the work? That’s on you. You can’t blame anyone else for that. If you do the work, understand what the management team is doing, like the industry, understand that the industry is going to continue to grow and understand that the business that you’re looking to invest in that company has the potential to do triple-digit in growth, those are the things you should be looking at.
You should be looking at long-term investments, not short-term investments, not day trading the stocks. The purpose of getting in is to sit back and share in the growth and vision of the company, that as it prospers, you prosper as well. If you don’t do the work, someone can come and put out some bad news, the stock can begin to fumble. As it goes ahead, it fumbles and then stumbles on down, what are you going to do? You’re going to do like everyone else who didn’t do their homework. You’re going to panic and then you’re going to start selling. “Scared money don’t make no money.” It doesn’t happen. The only way you can’t be the scared money is you do the research. You already know what the expectations are. Are they going to hit those expectations all the time? No, they’re not.
What you’re betting on is that their track record and stats are strong enough as a company and as a management unit, that they’re going to be able to achieve the things that they said. They might say they’re going to achieve 50 locations. I might, in doing my research, say, “They said they’re going to do 50.” I only think they’re going to get fifteen. They said they’re going to do 50, but I’m looking and grading the management team. I’m grading how much capital they have to work with and how many people might invest in them. “I think you’re only going to get fifteen. I think to get to fifteen is going to take you longer than you expect.” I’m betting that, “They can get to fifteen, but I don’t know if you can get to 50. That means I’m going to share in that growth and participate in that. As they win, I win.” You’re looking at it. You’re doing your homework and due diligence. They’re talking about they’re going to do 50 locations and you’re looking at, “They’ve never done one location.” In fact, the one that they’re running is not being ran too well and you’re like, “I don’t think they can do one.” What would that tell you? You probably shouldn’t invest in that company.
Let’s keep this real. I’m trying to make this simple and easy because everyone wants to make it so complicated. It’s not complicated. I’m trying to demystify investing in companies. That’s what we’re trying to do. I’m trying to make it simple for you. I’m not the smartest kid in the toolshed there and neither are you. There’s no out there who can predict what humans and stuff can do and what the outcome that’s going to be predicted tomorrow. God can, but none of us is him. The best thing we can do is our homework and look at the past performance of these companies, their stocks, of management and of the things that they’ve tried and failed. Every once in a while, in our failures, sometimes it makes us stronger and better.
Don’t just look at the company and say, “It failed. It’s not a good place to invest.” Sometimes you got to read between the lines. When I used to play ball, you get hurt and you want to come back from an injury so you work out harder. There are some people who are extremely competitive. That’s what you’re looking for in the management team and the CEO, “Is he competitive?” If he’s not, then you probably want to run because he’s not going to get the job done, but maybe he is and his management team is competitive. They felt bad because they struck out, lost a big one and couldn’t get the job done, but this time, they’re on fire. They have dotted all their I’s and crossed all their T’s.
You got to try to find that silver lining and say, “Did these guys learn from their previous mistakes?” I don’t know how to tell you how to do that. You have to determine that yourself when you’re doing your due diligence. What I typically do and strongly recommend that you continue to do as well, I look at the history. I see where they’ve been successful and try to bet on successful patterns. Just because they were successful before in the past, unfortunately, it doesn’t mean they’re going to be successful now in trying to get it done. There you have it. That’s why we call it investing because you don’t freaking know. Anybody who tells you that they have all the answers, they’re blowing smoke up on you know what.
Don’t be a junkie for news. Listen to all the news. When you see good news or bad news, don’t go run out and sell. If you want to be like me, don’t just start buying because you got some bad news out there and you know what’s about to come. Make sure you’re comfortable with your due diligence, please. That’s what’s going to save you money. That’s what’s going to make you a good investor. That’s what’s going to make you money over money and time after time. You’ll keep making money. You are going to have some losses. Don’t think anything I’m saying is 100% without losses. You’re not going to have 100% win in every investment. You will have some losses, but your losses will be very minimum than the person who threw caution to the wind and invested on a hot stock tip and they didn’t know anything about it. We’re going to get back to the video. They’re doing a good job in breaking it down into layman’s terms so we all can get and understand it.
Scared money doesn’t make any money.
“This see-saw of supply and demand is influenced by many factors. Companies are under the unavoidable influence of market forces, such as the fluctuating price of materials, changes in production technology and the shifting costs of labor. Investors may be worried about changes in leadership, bad publicity or larger factors like new laws and trade policies. Of course, plenty of investors are simply ready to sell valuable stocks and pursue personal interests. All these variables cause day-to-day noise in the market, which can make companies appear more or less successful. In the stock market, appearing to lose value often leads to losing investors and in turn, losing actual value.”
“Human confidence in the market has the power to trigger everything from economic booms to financial crises. This difficult-to-track variable is why most professionals promote reliable long-term investing over trying to make quick cash. However, experts are constantly building tools in efforts to increase their chances of success in this highly unpredictable system, but the stock market is not just for the rich and powerful. With the dawn of the internet, everyday investors can buy stocks in many of the exact same ways a large investor would. As more people educate themselves about this complex system, they too can trade stocks, support the businesses they believe in.”
Everyday investors can buy stocks. That’s you, people, everyday investors, who can go and find a company that’s in a merging industry that’s going to grow and scale. You can take your money and invest. I’m Solomon RC Ali. I’ve been an Officer of three publicly traded companies. My duties and responsibilities were to arrange the funding and capital for those companies. That’s huge. I sat on the board as an Officer and a Director of three publicly traded companies, where I had the sole responsibility to arrange the capital for these companies. Of the 3 companies, 2 of them basically cornered the market. The energy company, NDR Energy, was the largest minority energy company in the United States of America.
The other was a company called Revolutionary Concepts that invented smart home technology, that a company, our exclusive licensee, EyeTalk365, had licensed to companies like Ring, SkyBell, HeathCo and CPI. Those types of companies are huge. You probably know Ring Doorbell was one of our licensees. They use our intellectual property. All of these companies have their own intellectual property, but we invested more money in our intellectual property and the development of that than the other companies did. This is why doing your homework is so important. When you’re reading this and you’re saying, “I don’t know if he knows what he is talking about.” This is what I did for a living. I raised money for companies. Of the three publicly traded companies that I worked with, two of them became leaders in the United States of America.
As a man of color, that’s saying a lot. What that should be telling you is, “If you look like me, you can do it, too.” What do you have to do? You got to do your homework. You can’t just throw it to the wind and say, “I got a hot stock tip.” It doesn’t work that way. You got to learn about management. You got to learn about what’s going on. You got to learn about their failures, “What did they learn?” They may have learned a way to go around some of the loopholes. Sometimes that’s what we learn from failures. “What did they learn from their previous successes?” If they understand what are the step and what are not the step, you got to understand that. You got to understand whether or not these guys can get the job done.
Why I bringing that up and share that with you, I want you to understand how unique that is. I said I was the Officer Director of three publicly traded companies. This is not a boasting thing. This is a factual thing. There are over five million companies in the United States of America at any given time with at least ten employees or more. That’s all there is, not counting the ones that have less than ten employees. With that, minority companies, people that look like me, minority in this case, I’m talking about specifically black-owned companies and black managed. There are less than 114,000 companies that are black-owned and black-managed with ten employees or more. Are you starting to see where this is going really quick? You’re talking to somebody who understands how to invest and the how to make money.
Let’s take it a little further. Of all of those five million, let’s just say under 15,000 publicly traded companies in the United States. I believe the number is more like 13,900 and some change as publicly traded. There are only approximately thirteen that’s black-owned, black-managed and black-controlled, where the majority of the shareholders are black-owned or black-managed. You got to remember, I told you that three of the publicly traded companies, I sat as an Officer and a Director where my responsibility was to arrange and raise them capital. Of the 3, 2 of them became leaders within their industries in the smart home technology, we cornered it. In energy, we were the largest minority-owned energy company in the United States.
That’s what I’m talking about. You got to know who you’re talking to and what you’re investing in. When I’m looking at a company, I’m not looking at it from the same lens you might be looking at it from. You might want to shift your thinking and say, “If I can learn one thing from Solomon, it’s going to make you a better investor.” It’s going to keep you from losing some money if you learned one thing. If you learned two things, you’re on your way to making some money. If you learned three things, you’re going to be in the money. If you learned more than that, you’re going to be unstoppable. You need to understand, everything is not going to be 100%. You’re going to hear Solomon always say, “You don’t have to lie, cheat or steal in business.” You have to do the work. The work is what’s important. The reason people lie, cheat and steal is because they can’t do the work. They had to pull some stuff out of wherever. They got to make up some stuff and get you to believe because they can’t do the work.
When you can do the work, you are not going to do those things. When someone tells me about a stock, company or something like that what I’ll do is I sit down and start pulling it out. I pull out those 10-Ks. I pull out those 10Qs. I pull the information. I start making my comparisons, looking at the historical and looking at other companies at what they’re doing in the industry. I start looking to see, “What can be added to create more value to this company? How can it be added? When can it be added?” Anybody out there knows how to cook. If you know how to cook, you can’t turn around and just put everything in the pot at the same time unless you’re making a stew. You got to place the right ingredients in at the right time and it’s the same here. Sometimes the management may want to do certain things, but you got to inject certain things at the right time to be able to accomplish your goals and objectives.
That’s what investing is all about. I didn’t mean for this to sound like a lecture day. I hope I didn’t bore anybody. I need you to get this and understand it, especially if you are an investor looking to make profits and have returns where it’s not at risk. I know I don’t like putting my money at risk. I would assume you don’t want to put your money at risk. I like to have my money work hard for me. I want it to come back though when it’s finished working. If I put some money out there, I want it to come back with some friends. The friends are called profits. That’s what I want. I hope you want to say it because I’m not just throwing it to chance. If you’re like me, you want to make sure that you’re investing in a company in its early stages. If you’re like me, you want to make sure you’re investing in a company before it goes public and right after it became public. We got a lot of content on Minority Business Access. Go back and look at some of those stuff.
We bring in some of the top leading experts in Trust Law. We brought in one of the guys who sat there and help participate in writing the FICO scores and consulted with the government. That’s the kind of people we bring in. We bring in people who are at the top of their field, who can tell you some things and secrets. If you learn just one thing from them, it’s going to help you in your life. It’s going to help your family. It’s going to help your generations to come. People challenged me on irrevocable trust and what’s the difference in this and that. I don’t get into what we call a pissing contest with anyone. If they want to be right, they can be right. I know what I know. I’m not trying to prove a point. I don’t need to. What I know is this. I know where I got my information from. I know what my information said.
If the information is wrong, then I would be wrong. If everyone has already agreed, if I go to an expert in Trust Law who wrote pretty much all the current Trust Law for the United States and how everyone interacts and was the leading expert for a period of time, I go to that person and he tells me how to do it. Do you think I’m probably in good hands? I think so. No matter who comes against me, I can stand there with confidence because I know where I went to get the information and I know who they are. I know that they were the leading expert.
That’s what I’m trying to tell you. I am pretty good at this stuff. I am an expert at building companies. You’ve seen that for yourself. You don’t have to take my word for it. I’m Solomon RC Ali. I was on the board of three publicly traded companies. Of the 3, 2 of them led the way within their industries. That’s important to know because that lets you know that you invest and you’re following the advice. I’m not a stock promoter, broker dealer or market maker. I am not trying to pump up a stock or anything. I don’t need to. I know how to do the homework. That’s what I’m trying to teach you so that you can do the exact same thing. Do your homework. Invest. Change your life. Change your family’s life. Change your friends’ life. That’s what you want to do.
Go to SolomonRCAli.com. Speak to my team. Look at some of the deals that we might be working on or some of the white paper, blogs or whatever it is that my people put together for your purpose because that’s why we’re doing it is to educate you. It’s for educational purposes only. Take the education. Use it as a tool and as a part of your arsenal to benefit you and your family. We’re going to get back to the video. I think this is a hot video. I like it because it’s simple. I always say to people who know me I’m a simple person. I keep it simple because the best way to make money is to keep it simple. If you start making things complicated, then you start losing money.
You don’t have to lie, cheat or steal in business. You have to do the work.
“Support the businesses they believe in and pursue their financial goals. The first step is getting invested. Interested in pursuing your own financial goals? Download a free audio version of The Richest Man in Babylon on Audible.com/ted-ed. You’ll not only get timeless advice on making and investing money but also an imaginative take on life in ancient Mesopotamia.”
I want you to understand, when you invest in the early stages, you’re typically buying your stock from the company itself. When you invest later on, let’s say in round 2 or 3, you’re typically buying the stock either from the company or one of the private equity or VC investors. It’s important to remember that. When you get to retail investing, you’re typically buying it from other investors who bought retail. This pool of people, of family and friends, private equity and VC people, that’s a very small pool that you would be buying from. When it becomes a well-known stock and mature, it becomes a large pool of retail investors and retail investors are buying from each other. If I’m a retail investor, I might buy the stock at $5 and I might sell it to another retail investor at $5.10. The company is not benefiting directly from it. It does benefit indirectly because it helps to continue to support the overall market value of the enterprise. We’re going to get back to the movie here.
“Download a free audio version of The Richest Man in Babylon on Audible.com/ted-ed.”
The Richest Man in Babylon is a must. I said it on many podcasts. I want you all to understand something. Some of these videos I see prior to me narrating. I hadn’t seen this one. I didn’t even know. That’s pretty hot.
“You’ll not only get timeless advice on making and investing money, but also an imaginative take on life in ancient Mesopotamia.”
Investing is simple. What are you going to do? First, you’re going to do your due diligence. You’re going to look at the company. You’re going to look at the industry. You’re going to look at the previous work that was going on within the company. If they made mistakes, you’re going to analyze the mistakes and see if they have learned from it. You’re going to go in with your eyes open. Just because they had a great track record previously, you’re not going to be naive and think that, “They may not make a mistake tomorrow.” You’re not going to be naive. You’re going to be good, savvy investors.
That starts with looking at the financial history for the previous years, looking at all the Ks, looking at all the Qs, looking at the 8-Ks, looking at the management discussion section and see what’s going on. You’re going to turn around. You’re going to look at and pull the 8-Ks, 10-Ks and 10Qs of their competitors. You’re going to see, “What are the competitors talking about? What’s going on there?” You’re going to turn around and do some industry research to see if it’s on an uptick. Is that industry growing? If it’s growing, then what you want to know is, “Now that I’m thinking about investing, how do my company fit in? How do they compare with the other companies in the industry, especially the top five companies in the industry? The company I’m thinking about investing in, what’s their new sauce. What makes them different? What are they going to deliver that the other companies are not? Where are they planning on getting their market share from?”
In other words, what I’m talking about is, “Where are they planning on getting their customers? How are they going to develop their market share? Is it to educate and bring on new customers? Is it going to be to take a market share from other companies that’s already out there?” These are the things that you’re going to be asking yourself. These are the things that we’re trying to help you with at SolomonRCAli.com. If you go there, these are the things that you’ll see that we’re focused on. Why do we want to help companies? Companies are having a tough time, especially after COVID, in getting capital and getting access to capital. There’s not a lot of companies out there that’s willing to help the low-end tier companies, companies that’s doing less than $10 million in sales.
We want to help those companies. We want to help them to scale, grow, achieve that triple-digit growth and to become the leaders within their industry. That’s what we want to do. We want to do that by helping to arrange their capital that’s necessary, betting on the right management teams who are going to re-invest the money in their company for growth, who are going to bring double-digit or triple-digit returns so that you and I, as investors in that company, can reap the rewards as they reap. That’s it. I want to take the time and thank you for reading. I love you, guys. Good luck. Please stay tuned for the next episode of Minority Business Access.