01. Start here: what you're buying

Stocks, bonds, and the funds that hold them are the public markets: listed on an exchange, priced every second, sellable with a tap. An alternative investment is almost everything else (apartment buildings, oil wells, private companies, loans), owned through a private offering instead of a public exchange.

A private offering is a real project with a legal wrapper: investors put money into an entity, the entity buys and operates the asset, and each investor owns a slice. Because it's private, you can't sell that slice on a whim. That's the trade-off for return potential, steady income, and tax treatment the public markets rarely match.

Every offering starts with a sponsor: the company that finds the project, negotiates the purchase, signs for the loan, and runs the business plan. The sponsor raises part of the money from investors, borrows the rest, operates the asset for a stretch of years (the hold), and then exits, usually by selling or refinancing. Cash comes back to investors along the way as distributions, and at the exit.

You'll meet the formal names in module 04: the sponsor is the general partner (GP), investors are limited partners (LPs). For now the shape is what matters: the sponsor runs it, investors fund it, and the offering pays both according to written rules.

Investor money is almost never the only money in an offering. Most offerings also borrow, typically a senior loan from a bank, secured by the asset itself, exactly like a mortgage. That loan is 'senior' because it's paid first: its interest is paid before investors see income, and at a sale the bank is paid off before investors see a dime.

Stack every source of money by who gets paid first and you have the capital stack. Lower layers are safer and earn less; the top layer (the equity you'd own) is paid last, absorbs losses first, and owns most of the upside. The borrowing also adds leverage: the loan amplifies the equity's gains when the offering goes well, and its losses when it doesn't.

Most private offerings are open only to accredited investors, a U.S. securities-law status meant to mark investors who can bear the risk. Individuals generally qualify by income (roughly $200k a year, or $300k jointly with a spouse, sustained and expected to continue), by net worth ($1M or more excluding the primary residence), or by holding certain securities licenses.

Minimums are real too, commonly $25k to $100k or more per offering, and the money should be capital you will not need during the hold. Module 04 covers why.

Altinvest curates private offerings from vetted sponsors and presents every offering in the same format, so offerings can be read and compared instead of decoded. The offerings are the sponsors' own: Altinvest is not a broker-dealer or an investment adviser, doesn't hold your money, and doesn't tell anyone what to buy.

That's also the posture this course teaches. Every module describes how things work and what to ask, never what to do. The judgment calls belong to the investor and their own advisors.