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SEVERAL YEARS TO GENERATE ABOVE-AVERAGE RETURNS BEFORE RETURNS IN THE
SECTOR ARE DRIVEN DOWN BY GREATER PLAYERS AND COMPETITION.”***

We have found this particularly true in the hard asset, venture capital and growth capital marketplace where
small operators and owners often desperately need capital to grow, retire, or fund a management
buyout. This allows us to create significant high yielding programs from illiquidity opportunities, often for years
before the rest of the world catches on to the profitability.

An example of this was a purchase we made in our last oil and gas fund. An operator needed cash and was
willing to take a 10% discount on the asking price if we could close quickly. We did our due diligence and
closed the transaction on some great assets within 2 weeks. These assets returned the purchase price within
36 months and continue to cash-flow into the portfolio 8 years later.

THE KANSAS EFFECT:

What is commonly known as the Kansas Effect is alive and well today. The Kansas Effect can be described
as finding opportunity in areas that others have forgotten or are too lazy to execute, OR, in areas where the
fund is so large that it cannot afford to execute. We make our living by uncovering opportunities that others,
especially large Fund managers, have not seen or cannot spare the time to research.

An example of this opportunity set resides in the overlooked Texas, Oklahoma panhandle today. Horizontal
drilling has opened new opportunities in the overlooked area of the US.

Another example, the initial investment in a small furniture company in Nebraska is one of the investments
that started Warren Buffet on the road to success and a strategy that is still his claim to fame today. He
researches opportunities that others have discounted and provides capital to exploit what he finds.

One of most important questions you can ask a small fund manager is "where have you been lately and what
did you learn". The answers will amaze you.

Opportunities Are Coming Our Way

My newest whitepaper is a highlight of what an equity investors portfolio would look like if s/he had been
partnering with us since the mid-1980's with a view of some of the ongoing programs we have available today.
Click Here To View a copy of Low Risk Opportunities Won & Coming 2016 and Beyond.

If you would like to discuss your investment programs or ideas, give me a call. We are open to new programs
and ideas continuously.

Thanks for reading,

Principal, Custom Private Equity

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