Real Wealth Show: Real Estate Investing Podcast · Kathy Fettke / RealWealth

How to Invest Like a Billionaire: Private Markets vs Public Markets with Bob Fraser

·25 min

Kathy Fettke hosts real estate investor and Aspen Funds CEO Bob Fraser to explore high-level investment strategies. Fraser, a former tech entrepreneur and professional trader, shares hard-won lessons from losing fortunes in both the dot-com crash and the 2008 financial crisis. The core discussion contrasts the volatile, highly correlated public markets with the data-driven private investment landscape Fraser now champions. Fraser argues that public markets, accessible via platforms like Robinhood, offer no real diversification, as seen when "everything turns red" simultaneously. He cites his own painful history, having been "twice destroyed by the public markets" before moving into distressed debt and real estate. The conversation tackles current concerns, acknowledging many investors are "losing their money in multifamily" as past deals unravel. Fraser references a past on-stage debate with Fettke about rising interest rates' impact on commercial real estate, where he argued the Fed's actions would negatively affect the sector. He applies a cyclical perspective, recalling advising friends to sell commercial real estate at its 2005 peak precisely because prices had "never been higher." A significant portion critiques gold as an investment, with Fraser calling it a "lousy" asset with "negative earnings" that doesn't cash flow. He presents data showing $1,000 invested in gold in 1980 would be worth $7,000 today, versus $190,000 in the S&P 500, and claims gold has only beaten inflation in one of the past six decades. Conversely, he makes a bold market call, declaring he believes "this is the bottom" for multifamily, industrial, and retail real estate, urging listeners to act when others are fearful. Fraser explains his personal comeback strategy involved partnering with others and implementing strict deal discipline, submitting to a team that can veto his ideas to counter his own "misplaced optimism." The central thesis is that billionaires and large endowments use the "Yale model" pioneered by David Swensen, allocating 50-60% of their portfolio to private alternatives like credit, equity, and real estate for higher returns and lower volatility. Fraser emphasizes that true diversification requires uncorrelated assets, not just many stocks, noting that a third of the S&P 500 is comprised of just ten correlated companies. He outlines a strategy using real estate as an inflation hedge, private credit for safe income, and natural resources for uncorrelation. In his own practice, Fraser diversifies within real estate, targeting industrial properties due to reshoring trends and neighborhood retail centers with cap rates of 8-9%. The tone is a candid, educational conversation between two seasoned investors, blending personal storytelling with analytical market perspectives. Listeners interested in portfolio construction beyond stocks, those curious about private market investing, and real estate investors seeking a cyclical outlook will find immense value. Individuals solely focused on public market trading or those seeking get-rich-quick advice should skip this detailed, strategy-oriented episode.

As heard by us

A reflective conversation about rebuilding after a dot-com collapse and the value of diversification.

The episode focuses less on a billionaire dream than on what comes after a collapse. Bob Frazier walks through building a dot-com in the 90s, raising $44 million in venture capital, growing to 300 employees, winning Entrepreneur of the Year, and then losing it all in the dot-com…

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Why you'd press play

You want a candid map from a dot-com crater to a real-estate and wealth-building reset.

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