Not exact matches
But when you can make 7 % via P2P Lending, 9 % — 12 % via real estate crowdsourcing, 8 % — 18 % via venture debt, 6 % — 12 % in SF real estate
unlevered, and 20 % + a year building an online business, suddenly, shooting for a ~ 5 % annual return in public
equities (my estimate for a realistic return) doesn't feel that great anymore.
Different
unlevered firms have different costs of
equity capital because they have different levels of sales volatility, and different degrees of operating leverage.
Rationality comes back to these markets when «real money buyers» appear (pension plans, insurance companies, wealthy dudes with nose for value), and these non-traditional buyers soak up the excess supply of investments that are out of favor, and do it with
equity, at prices that make the
unlevered return look pretty sweet.