How the Wealthy Really Invest W/Tad Fallows

Dec 30

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Episode Description

Welcome to the On The Rise Podcast. In this episode, Jeremy Dyer sits down with Tad Fallows, Founder of Long Angle, a private community for entrepreneurs, executives, and investors seeking unbiased insights and institutional-grade private market opportunities. Tad shares his journey from bootstrapped founder to successful exit, and how the sudden jump in net worth led him to build a trusted peer group for high-net-worth families. He breaks down misconceptions around how wealthy individuals truly invest, why traditional 60/40 portfolios fall short, and what smart investors are reallocating toward today. Tad also explains how to evaluate private funds, identify red flags, and avoid the sophisticated tax schemes that often get high earners into trouble. Whether you are building wealth or protecting it, this episode offers clarity, strategy, and perspective for anyone looking to take control of their financial future.

Summary

Tip 1: Community Beats Isolation for Wealth Decisions
"We wanted advice from people who weren’t trying to sell us anything."
Tad created Long Angle as a peer-driven resource for investors managing between five and two hundred million in assets. Members join for access to unbiased experiences, vetted strategies, and real-world insights not influenced by sales incentives.

Tip 2: Most Wealthy Investors Do Not Use Traditional 60/40 Portfolios
"Almost no one holds bonds anymore."
Through internal benchmarking, Tad’s group found that affluent investors hold roughly 50 percent in public equities and 45 percent in private market alternatives, with minimal bond exposure.

Tip 3: Private Markets Are Where the Smart Money Goes
"These assets offer higher expected returns and low correlation."
Members lean toward private equity, venture capital, real estate, and specialty alternatives such as oil and gas, litigation finance, and royalties. The goal is high-return assets that move independently of the public markets.

Tip 4: Real Estate Remains the Most Tax-Efficient Wealth Builder
"If you want a legal way to minimize taxes, real estate is 90 percent of the juice."
Depreciation, 1031 exchanges, and passive income benefits make real estate the most powerful tax shelter for high net worth individuals.

Tip 5: Beware of Tax Schemes That Sound Too Good to Be True
"I’ve seen people pitched frozen cantaloupe seed donations as a tax strategy."
Even when a CPA recommends a structure, it doesn’t mean it’s legitimate. High earners must vet advice carefully to avoid penalties or IRS scrutiny.

Tip 6: Evaluate Investments by Who Else Is Investing
"If institutions are in the deal, that’s a good sign."
Institutional co-investors such as endowments demonstrate that the fund has passed strict diligence. Retail-only investor pools signal higher risk.

Tip 7: Look for Simple, Transparent Fee Structures
"The nickel-and-dime fee menu is a huge red flag."
Investors should avoid firms with stacked acquisition, disposition, financing, and waterfall fees. Institutional-grade operators typically offer clean, straightforward terms.

Tip 8: Fraud Risk Is Real and Must Be Considered
"There’s always a small percentage of bad actors."
From FTX to small private funds, fraud remains a non-zero risk. Investors must look for track record validation, proper audits, team depth, and operational controls.

Tip 9: True Financial Freedom Comes from Passive Cash Flow
"I want passive income that covers the lifestyle I want."
For Tad, financial freedom is defined not by a number but by predictable passive income that supports a flexible, family-focused lifestyle.

Tip 10: Define Your Objectives Before Choosing Investments
"Most people jump to tactics before defining what they want."
Investors often build portfolios without clarifying long-term goals, risk tolerance, or lifestyle expectations. Tad recommends starting with your end destination, then building the strategy.