Given the amount of liquidity, you could look at setting up your own organised Single Family Office, run by professional managers whose mandate will be to manage the family’s fortune across financial investments, real estate, taxes, etc, and generate a superior risk-adjusted return.You could also consider turning into a serial entrepreneur and channel anywhere between 20 and 25 per cent of your newfound wealth towards promoting these ventures. Since he has the required skill and business acumen, it would be worthwhile to help identify and back a lot of new start-ups, provide them with not just capital but also mentorship and guidance, which will be most sought after. Impact investments, which are investments that aim to generate social or environmental benefits in addition to financial gain, is something that would be of interest to a young billionaire like you. These investments, when done strategically, have the potential to grow at 20-24 per cent annually till 2025. When it comes to the allocation for personal financial portfolio, you should look at deploying appropriate amounts across a diverse asset mix of funds, stocks, bonds, real estate, etc. The actual allocation varies from one individual to another and should always be driven by age, risk appetite and goals of that specific individual. One could choose between static, tactical and dynamic asset allocation models. A well-allocated portfolio should provide steady returns over time, irrespective of market volatility.
At a very young age of 36 years, with the entrepreneurial bug still in you, you can turn the corpus of $1 billion (Rs 66 billion) into something much more in terms of contribution to the Indian start-up ecosystem. You can also use this sum to generate additional personal wealth while protecting the core corpus.The first step that should be taken when individuals gain such a large corpus of all-cash acquisition deals is to form a single family office. A single family office will ensure the following: protection of the core corpus; drafting of an investment mandate to streamline investment decisions; establishment of a professional management structure for the wealth; undertake philanthropic activities; and manage operating businesses, if any. The main concern that needs to be addressed vis-a-vis large wealth is the inter-generational transfer of assets. This needs to be chalked out and executed efficiently for optimum tax incidence. It is usually achieved by setting up a trust structure for legal ring-fencing of the wealth and executing the mandate effectively. Once the platform of execution is dealt with, you can look forward to efficient investment management via asset allocation for the generated wealth in order to generate the maximum possible risk-adjusted returns. Entrepreneurs who cash out at a young age usually look to start new ventures and mentor or take over an existing operating business in their line of expertise. This ensures a steady flow of additional income, leaving the core corpus untouched many times. The allocation of assets should be done based on your ability and willingness to take risks. This will help decide what proportion of investments should be made in different asset classes like equity, debt, real estate, private equity and venture capital based on the risk profile and requirements of funds. The preservation of the core investment corpus is key to the allocation of the investment portfolio, which can then allow for tactical allocation towards assets that can generate the next billion dollars. These can be either new ventures or investments in existing operating companies.