The reason investors will choose to invest in
something you are selling is confidence.
The typical challenge faced by a financial advisor is gaining the knowledge necessary to feel confident in a potential private investment, and getting you investing clients to share in that confidence and make an investment.
To gain confidence in a product and the trust of your clients, you need information you can trust to base your advice on. Financial advisors face four main challenges in building this trust:
1) Global trust levels in the financial services industry are extremely low.
2) The limited amount of information that a private company chooses to disclose conflicts with investors’ desire for transparency.
3) Investors have very few resources to verify what is provided or to seek additional information in an efficient manner.
4) The commission structure paid to financial advisors creates a potential conflict of interest that makes it easy for investors to distrust the information provided to them.
Base10 believes that giving financial advisors and their investors the confidence and trust necessary to make a private investment is best accomplished by providing an independent, in-depth source of investment research and the transparency and validation that it delivers.
Why Base10’s Independent Research Matters to Financial Advisors
Investors often rely heavily on the trust they have with their financial advisor for the information they need. Advisors put their reputation on the line very time they recommend an investment to a client.
Base10 believes that equipping financial advisors with independent investment research will provide the advisor with validation for the advice they give their clients. This will protect and strengthen the advisors’ reputation and enhance the investor’s level of confidence in the advice they receive.
The limited amount of information typically made available makes it difficult for an investor to feel confident that they have all the information they need to make an informed investment decision.
Base10’s independent investment research provides the transparency advisors need to help their clients make confident, informed investment decisions.
The absence of liquidity to quickly exit a private investment magnifies the need for advisors and investors to trust in the information provided to them. Base10 believes that Independent informationproduced by recognized experts and free from conflict of interest is one of the keys to building trust.
Increasing confidence and trust will have 3 important consequences:
1) It will increase the efficiency of the investment decision making process,
2) It will increase willingness to participate in the private capital markets, and
3) Ultimately, it will help to increase in the pace of raising capital.