Archive for November, 2021

The Learning Curve: investing in education

Generally when we invest we are investing in the future: our retirement, our children’s future, and if philanthropically minded, we might think we are investing in endeavours that will ultimately deliver benefit to the assorted communities of the planet. But of all the choices available, investing in education must prove the most fundamentally important vehicle for a better future for all.

Without education, none of the fine companies, organisations and their values and goals will mean much. Education is the basis for anything happening anywhere. As a species we have grave problems to resolve, both in the present and in the future, all solvable no doubt by people trained to understand, invent, action and imagine. Without these educated drivers of endeavour nothing much will happen, and investment everywhere will lose value.

Education is the prime mover of humanity’s progress. As such, investment in this sphere has many benefits.

Looking at the education status as an investment

In a world driven by science and technology, it is unfathomable that, as a species dependent purely on knowledge, we are not educating our children to the best of our and their abilities. Education faces challenges in nearly all countries, opening up the field for almost unlimited investment and positive returns.

  • As governments in general are not effectively meeting the growing demand for education, investors have the opportunity to enter a major market demand which holds the potential for solid financial returns, while also attaching high social value to their contribution.
  • There is a distinct business dynamic to this sector, and it is increasingly recognised as a strategic growth prospect. Private funding is playing a pivotal role in developing education across the board. Tertiary education in particular is expected to reach a high growth rate annually over the coming years. Impact investment in education particularly, can prove good results in a few years.
  • Education is a long-term and forward-looking investment: it contributes directly to the landscape of industry and investment opportunities of the future. A vibrant, continual and steadily growing sector, it will remain forever relevant in the decades to come.
  • If students today are not made ready for the jobs of tomorrow, economies can only face decline. To remain relevant, educational institutions must respond to the labour market and industry needs, as well as balancing the ambitions and enterprising talents of the students.
  • There is no doubt that education is evolving at a rapid pace, and as a result many institutions are powering up to compete with peers at international level. Education as a growth investment is growing globally in popularity.

Africa and South Africa – what are the options?

Unfortunately, the current view of the South African education system is not exciting. Potential investors tend to see government schools and community colleges as fairly low-quality, and requiring substantial upliftment. Neither are racial quotas popular with investors.  

But the wheel is turning, and more private schools and colleges are finding their feet. Students are benefitting from smaller classes and well-equipped campuses with high standard teachers and lecturers, affording greater attention and assistance with studies. There are also more options for study courses available, broadening the spectrum of training. However, in South Africa, private educational institutions are subjected to the same level of accreditation, regulation, and oversight by the Government.

Social responsibility is beginning to play a larger role in investment choices. While business is concerned with profit, investors are looking for ways to make a difference to the world while gaining that profit. And private education is providing impressive avenues in this sphere, pushing for higher quality in the services provided.

Africa still holds huge potential. By improving government schools and investing in private education facilities, more high-quality learning opportunities can be created. This ultimately would transform the development path of low and middle-income countries. And this factor in turn, will present enriched investment opportunities across the continent.

When education is seen as a business, it’s attractive from several viewpoints:

  • It’s an investment with a long-term revenue potential.
  • The prices of private education will grow steadily, and African countries are expected to follow that pattern.
  • The publishing industry in South Africa and Africa is wide-open for development. Books are the cornerstone of education – and currently this sector is languishing. It’s a business that has tremendous growth potential.
  • Investors who favour education are seen as brands with heart, and will be long honoured as such.

Foster Wealth: steering business, driving wealth

At Foster Wealth innovation, agility and in-depth market acumen are our daily fare. The volatility of markets, unexpected events and fluctuating values continually take us to new levels of interest and possibility. Constant re-assessment and evaluation are how we keep ahead of the curve – but our hard work, professionalism, attention to detail and personal attention are the hallmarks of our business and will never change.   

Find out more about us at: www.fosterwealth.co.za    

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Investment Unusual: investing in the entertainment industry

Not everybody necessarily wants to follow the conventional route when investing, which is a good thing because it means that many more industries find support and motivation, swinging into action with enthusiasm and often bringing good returns – if not spectacular on occasions. Entertainment may be peppered with fashionable and fad moments, but there is always a track of ongoing  production which creates an industry indisputably vital and neverendingly popular. This translates to money – and very often big money.

The leisure and entertainment industry has seen ups and downs, but trends essentially show that the overall the growth rate is constantly rising. The industry encompasses numerous investment opportunities from movies to television to travel, hospitality, sports and the media. Whether you invest in children’s play equipment, galleries, restaurants, hotels, theatres, productions, or sports – you are investing in entertainment of one kind or another.

And when investing it’s always good to consider what people are hungry for…whether it’s a new pop group, cannabis production, an innovative game, or simple good spaces that people enjoy. No matter the climate – financial, political, or the weather – people like to kick back and have a good time. If you would rather take entertainment and all affiliated engagement off your list as a possible investment vehicle, you might be missing out on the next big thing.

Reasons for investing in the entertainment industry

Reasons for Investing in the entertainment industry are many, variable and individual. But they are generally seen as a positive choice.

  • There is the possibility of high returns – returns that may continue over a long period of time. However, the lure of high returns can be risky like any other investment. Money may be poured into a high-octane production, but public acceptance and critical reviews can dash fundamental hopes.
  • With mutual funds, you are able to spread the risk.
  • Despite the high cost of large entertainment projects such as motion pictures, investors can participate at very low levels of investment. By investing in an independent film, the initial production of a musical or a new band’s first recording session – it is possible to participate in the industry for reasonably small amounts at a time.
  • However, a successful offering can have a very long shelf life. Consider the musical ‘The Fantastiks’ first produced in 1960 and which became the longest-running musical in history, with more than 17,000 performances. For a reasonable investment in 1960, investors are still receiving dividends today. 

Faith, hope, and a touch of charity

The development of ideas.

Everything developed within the entertainment industry depends on the amount of money put up – usually purely on ideas alone. In a sense, the investment is based on imagination. So faith and belief in a project is paramount to ultimate success, or alternatively, dismal failure. This is why it is vital to partner with professionals in the shape of reputable financial advisors who understand the industry and the importance of research.

Factors to consider before investing include:

If you’re looking at the movie industry or the development of any visual project, you have to investigate the reputation of the producer; the experience of the team involved; the script and the screenplay; and the input of other investors who may be equally keen on the project. In this instance, it’s wise to invest in mainstream and more broadly popular films or shows that will have definite returns, rather than taking a chance on a niche-focused project unlikely to draw a large audience.

Various ways to invest in entertainment.

  • You can consider private equity and hedge funds as they can be the best direct investment in entertainment ventures.
  • Invest in a portfolio of films rather than putting your money in a single production. This creates greater balance of risk and return.
  • You can also invest in the stocks of various entertainment companies such as Universal, Warner Bros, Paramount, Hallmark, Netflix, etc.
  • The leisure sphere also offers wide choice – from hotels to theatres to restaurants. From gaming to fashion design to cosmetics and beauty chains, there is a vibrancy that can only attract, and generate, money.

Far from being unstable as some people believe, the entertainment industry is complex, surprising, adventurous and dynamic. Perhaps high risk, but always steadfastly betting on high returns. Investing your money in one form or another may prove a bit of a rollercoaster ride, but could be highly satisfying nevertheless!

Foster Wealth: steering business, driving wealth

At Foster Wealth innovation, agility and in-depth market acumen are our daily fare. The volatility of markets, unexpected events and fluctuating values continually take us to new levels of interest and possibility. Constant re-assessment and evaluation are how we keep ahead of the curve – but our hard work, professionalism, attention to detail and personal attention are the hallmarks of our business and will never change.   

Find out more about us at: www.fosterwealth.co.za    

 

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