Private Company Investing: A Self-Directed IRA Option You Might Not Have Heard Of

That’s a morsel from investment guru Naval Ravikant's work “The Almanack of Naval Ravikant” and remains true today: investors who want retirement freedom are going to have to own at least a piece of a business to succeed. But what investors don’t always know is that a Self-Directed IRA opens up business ownership beyond the public stock market. If you engage in private company investing with your Self-Directed IRA, a business that takes off could change everything for you.

Here’s the good news: private company investing with a Self-Directed IRA isn’t just for venture capitalists or Wall Street insiders. It’s an option available to everyday investors who simply want to diversify their retirement portfolios. With the right approach, your Self-Directed IRA can become a powerful and life-changing tool to invest in startups.

Self-Directed IRA Investing: When Private Company Investing Makes Sense

Public stocks offer limited control and can often feel like a rollercoaster ride—especially when the economic headlines are stormy. By contrast, private company investing offers the potential for higher returns. You’re getting in much closer to the ground floor. As such, these businesses can be high-risk, high-reward ventures. With a Self-Directed IRA, you can take a more hands-on approach, choosing businesses with strong growth potential or those aligned with your values and expertise.

For instance, imagine you have experience in the tech industry. You could use your Self-Directed IRA to invest in a promising tech startup, leveraging your knowledge to make informed decisions. Or maybe you want to support a local business poised to scale.

How It Works: The Basics of Using a Self-Directed IRA for Private Investments

Investing in private companies with a Self-Directed IRA might sound complex, but it’s straightforward once you understand the process. Here’s a simplified breakdown:

A Self-Directed IRA is the ideal tool for these types of investments because of the tax protections involved. Peter Thiel, the famous investor, reportedly put private company stock into a Roth IRA, netting billions of dollars of benefits that he may not have to pay taxes on later in life thanks to the advantages of a Roth IRA. That’s no promise of the kinds of results you’ll get, of course. But it highlights what Naval Ravikant said about ownership: for many, it’s the key to wealth.

If you’re interested in a Self-Directed IRA and potentially investing in private company stock, the two can be a match that’s perfect for anyone who wants something more than public stocks. Reach out to us here at 866-7500-IRA.