Investors See Far Out Profits in Psychedelic Medicine
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    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,587,785 (-9.64%)       Melbourne $968,477 (-1.28%)       Brisbane $894,769 (-1.51%)       Adelaide $810,780 (-6.94%)       Perth $764,276 (-4.92%)       Hobart $750,134 (+1.16%)       Darwin $645,801 (-3.38%)       Canberra $1,017,220 (+3.56%)       National $1,010,264 (-5.75%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $725,381 (-1.27%)       Melbourne $488,555 (-0.24%)       Brisbane $499,581 (-5.39%)       Adelaide $411,364 (-4.41%)       Perth $414,273 (-2.57%)       Hobart $498,192 (-6.11%)       Darwin $351,130 (-4.84%)       Canberra $480,942 (-4.46%)       National $506,040 (-3.24%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,047 (+6,578)       Melbourne 14,543 (+5,785)       Brisbane 8,228 (+1,243)       Adelaide 2,741 (+600)       Perth 6,788 (+1,322)       Hobart 1,219 (+48)       Darwin 269 (+17)       Canberra 1,013 (+155)       National 44,848 (+15,748)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,226 (+4,905)       Melbourne 7,846 (+2,295)       Brisbane 1,759 (+304)       Adelaide 499 (+101)       Perth 1,899 (+331)       Hobart 186 (-9)       Darwin 388 (+26)       Canberra 854 (+60)       National 21,657 (+8,013)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $780 ($0)       Melbourne $590 ($0)       Brisbane $620 ($0)       Adelaide $600 ($0)       Perth $650 ($0)       Hobart $550 (-$10)       Darwin $680 ($0)       Canberra $690 ($0)       National $652 (-$1)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $725 (-$5)       Melbourne $580 ($0)       Brisbane $620 (-$10)       Adelaide $450 (-$20)       Perth $600 (+$15)       Hobart $470 (-$10)       Darwin $570 ($0)       Canberra $570 ($0)       National $584 (-$3)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 5,614 (+7)       Melbourne 5,631 (-24)       Brisbane 4,055 (-125)       Adelaide 1,248 (+4)       Perth 1,830 (+7)       Hobart 380 (+12)       Darwin 153 (-19)       Canberra 664 (-12)       National 19,575 (-150)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 7,725 (-368)       Melbourne 5,038 (-276)       Brisbane 2,044 (-65)       Adelaide 394 (+11)       Perth 594 (-34)       Hobart 139 (+1)       Darwin 285 (-5)       Canberra 590 (-16)       National 16,809 (-752)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.55% (↑)      Melbourne 3.17% (↑)      Brisbane 3.60% (↑)      Adelaide 3.85% (↑)      Perth 4.42% (↑)        Hobart 3.81% (↓)     Darwin 5.48% (↑)        Canberra 3.53% (↓)     National 3.36% (↑)             UNIT ANNUAL GROSS YIELDS AND TREND       Sydney 5.20% (↑)      Melbourne 6.17% (↑)      Brisbane 6.45% (↑)      Adelaide 5.69% (↑)      Perth 7.53% (↑)      Hobart 4.91% (↑)      Darwin 8.44% (↑)      Canberra 6.16% (↑)      National 6.01% (↑)             HOUSE RENTAL VACANCY RATES AND TREND       Sydney 0.7% (↑)      Melbourne 0.8% (↑)      Brisbane 0.4% (↑)      Adelaide 0.4% (↑)      Perth 1.2% (↑)      Hobart 0.6% (↑)      Darwin 1.1% (↑)      Canberra 0.7% (↑)      National 0.7% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 0.9% (↑)      Melbourne 1.4% (↑)      Brisbane 0.7% (↑)      Adelaide 0.3% (↑)      Perth 0.4% (↑)      Hobart 1.5% (↑)      Darwin 0.8% (↑)      Canberra 1.3% (↑)        National 0.9% (↓)            AVERAGE DAYS TO SELL HOUSES AND TREND         Sydney 36.6 (↓)       Melbourne 40.8 (↓)       Brisbane 36.8 (↓)       Adelaide 31.2 (↓)       Perth 41.1 (↓)       Hobart 41.6 (↓)       Darwin 49.2 (↓)       Canberra 39.9 (↓)       National 39.7 (↓)            AVERAGE DAYS TO SELL UNITS AND TREND         Sydney 36.2 (↓)       Melbourne 39.2 (↓)       Brisbane 33.8 (↓)       Adelaide 30.0 (↓)     Perth 43.3 (↑)      Hobart 43.8 (↑)        Darwin 33.7 (↓)       Canberra 45.3 (↓)       National 38.2 (↓)           
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Investors See Far Out Profits in Psychedelic Medicine

A former hedge-fund portfolio manager raises millions from scientists, financiers and crypto bros eager to buy into treatments that aren’t even legal yet.

By Matt Wirz
Thu, Jul 14, 2022 2:06pmGrey Clock 5 min

It’s been a long strange trip for Brom Rector to become one of the few venture capitalists investing exclusively in psychedelic medicine. The 31-year-old has been experimenting with drugs like LSD for a decade but he never imagined he could turn that interest into a career.

Now Mr. Rector, a former hedge-fund portfolio manager, is raising millions of dollars from scientists, financiers and crypto bros eager to buy into treatments that aren’t even legal yet. They are betting that hallucinogens will eventually be approved for medical treatment and recreational use, spurring a boom from biotech to the entertainment industry that will far outstrip the fitful growth of legal cannabis.

Mr. Rector burned out from his job as a quantitative researcher for Los Angeles-based Crabel Capital Management in December 2020 and launched a podcast a few months later to delve into the budding psychedelics market. Listeners began asking him for investment ideas, prompting him to open his VC firm—Empath Ventures—in the fall.

Empath has since raised US$2.1 million of a $10 million target for its first fund and made 10 investments. Portfolio companies include Mindstate Design Labs, which develops new psychedelics, and Wavepaths, a company that designs smart music software to help therapists steer clients’ trips. The firm is one of a small but growing cadre of investors, including JLS Fund and billionaire Peter Thiel, taking interest in psychedelics.

Psychedelics are making the jump from party drugs to prescription drugs because some clinical research shows they are effective at treating conditions like depression, post traumatic stress disorder and addictions. Investors are also backing research and development in new drugs with other applications, like treating traumatic brain injuries. Much of how psychedelics affect the brain is unknown and critics worry about potential long-term damage or psychosis from excessive use.

The Food and Drug Administration approved the use of a drug similar to ketamine for treatment-resistant depression several years ago, and is expected to rule on an application for MDMA-assisted therapy in 2023. MDMA is more commonly known as the main ingredient in Ecstasy. Psilocybin, the hallucinogenic compound in mushrooms, could also see action from the FDA in the next few years.

The Wall Street Journal spoke to Mr. Rector about his return targets, legalization and convincing his mom to trip.

What are the returns you are looking for in your investments?

It’s just like a traditional biotech play. There’s a high probability of failure and potential upside of 10, 20, maybe 50 times.

I also invest in the infrastructure and accessories around psychedelics. The clinics where the stuff is delivered, the companies that make software to support the clinics. A lot of those businesses are not going to have that 50 times potential but they have a lot higher probability of becoming cash flow positive.

When most people think of psychedelic therapy they think magic mushrooms, maybe ayahuasca, both of which grow in nature. What about man-made drugs?

The final frontier is the exciting world of novel psychedelic molecules. It blows my mind that LSD was invented in 1938—before computers. We have all these amazing tools at our disposal now, and we’re entering a time where it’s culturally acceptable to apply those tools to the discovery of new psychedelic drugs.

LSD is amazing, as are classic cars from the 1930s. The Tesla Model S of psychedelics is yet to be created.

What is socially acceptable psychedelic use in the industry? Do you trip with your investors?

I’ve had a lot of people tell me that if I want to raise capital I should just start passing out psychedelics to my investors. I think there’s a moral issue with that. No, I have not tripped with my investors and I don’t plan on tripping with any of my investors. I haven’t tripped with any of my portfolio companies either.

There are some other investment groups out there that do not have the same answer that I just gave you. I know that it happens.

Are there medical applications of psychedelics other than mental health coming down the road?

Mental-health indications and addiction treatment will likely be the dominant applications of psychedelic medicine in the short term.

That said, psychedelics are really good at inducing neuroplasticity and reducing inflammation, so it makes sense to research them as treatments for any indication that could theoretically benefit from either of those things.

There are in-progress Phase 1 trials of psychedelics as treatment for ischemic stroke, alzheimers and TBI [traumatic brain injury]. I also know someone who personally used psychedelics as part of a treatment program to regain cognitive and motor function after suffering a severe TBI. It’s too early to say for sure, but it seems like there might be something there.

Why are cryptocurrency traders now investing in psychedelics companies?

To really get into crypto you have to be a big believer in crazy bold new ideas. Psychedelics is similar to crypto in the sense that it is a crazy big sort of bold new investment thing.

But, I think that the underlying technology and application of psychedelics is much more proven than that of crypto. In crypto the upside is enormous because it doesn’t seem like anyone is actually policing it in these exchanges. I think in the long run the upside of psychedelics is more similar to the upside of any other sort of revolutionary biotech play.

What about recreational use of psychedelics? Is that also coming?

One of the things I emphasize in my pitch deck for investors is that I want to invest in companies that are not threatened by de-regulated recreational-use regimes because I think they are inevitable. In the long run, I think we’ll see a few states that will have fully recreationally legal psychedelics

When you look at what Oregon is doing [decriminalized psilocybin and legalized therapeutic use] they’re being very open minded about the use of psychedelics. It wouldn’t surprise me to see concerts or other events there in the future where everyone gets a low dose of psilocybin to make the colors brighter and the music sound better.

Are there any potential risks in wider recreational use, among young people?

The more that users are educated on the importance of “set and setting” [mindset and environment] and know about potential interactions of psychedelics with other drugs and other contraindications, the better outcomes will be. When things become legal, the stigma around them lifts, and it becomes easier to share this information openly—so I think that recreational legalization would actually be a harm-reduction method.

I hope the industry ends up being proactive and responsible with its messaging. There is still stigma around the use of psychedelics and a single, high-profile case of a bad trip could rob the industry of a lot of social credibility, even though many people die from socially acceptable drugs like alcohol and cigarettes each day.

Could there be a political backlash against liberalizing use of psychedelics?

Conservatives are much more open minded about psychedelics than you might think because of the narrative of psychedelics treating PTSD. Who gets PTSD a lot? It’s veterans. [Former Texas Gov.] Rick Perry has gone on the record saying Texas should fund studies on it.

Psychedelics are gaining ground all over the place even amongst the midwestern housewife subsegment of the population.

And you mentioned your mom has tried them?

My mom, who never really did any sort of substance or alcohol consumption, ended up deciding that she wanted to try it. As I started the fund she started paying more attention to it and read all the articles she could find about it, including the one in Good Housekeeping.

You hear enough experiences from people that are in your own demographic and soon enough you’re like “Maybe I should try it. It’s not just for those weird hippies after all. It’s for me too.”

Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: July 13, 2022.



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Amid Geopolitical Concerns, Major Philanthropy Continues to Forge Ahead…Creatively
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Even amid two international conflicts and an upcoming U.S. presidential election, some philanthropic leaders are optimistic about the direction of overall giving through 2024.

Penta spoke with heads of several non-profits and leading philanthropists to gauge whether charitable giving will continue its reported slump from 2023 or rebound alongside renewed interest in various political and economic issues.

“Contrary to what some might expect, philanthropy has had resilience in these times,” says Stacy Huston, executive director of Sixdegrees.org, a youth empowerment non-profit based in Virginia founded by actor Kevin Bacon in 2007.

Huston’s view echoes recent data from the biennial Bank of America Study of Philanthropy published last year, which found that while affluent giving is largely down, the value of the average philanthropic gift is up 19%, surpassing pre-pandemic levels.

The notion of what these gifts look like is changing, and is partially responsible for the growth. Philanthropy can be executed through more avenues than ever, whether through celebrity association, tech titans stewarding large endowments, or  athletes using their platforms to advocate for and create meaningful change.

“The industry and movement is creating new models, and you want to get it right,” says Scott Curran, CEO of Chicago-based Beyond Advisers. “No one should take their foot off the gas pedal.”

Curran spent a number of years with the Clinton Foundation in its infancy before leaving in 2016 to open his own consultancy, which focuses on philanthropy strategy at the highest levels. Curran and his team work with celebrities, athletes, multi-generational family foundations, and other affluent givers who need guidance in directing their philanthropic efforts. It’s a growing area of interest: Over half of affluent households with a net worth between US$5 million and US$20 million have, or are planning to establish, “some kind of giving vehicle” within the next three years, according to the Bank of America report.

Corporate philanthropy, rather than individual giving, is the cornerstone of Marcus Selig’s work as chief conservation officer at the National Forest Foundation, a Congressionally chartered non-profit based in Montana responsible for protecting millions of acres of public lands.

“Our outlook is business as usual,” he says, advising that giving may slow down, but not enough for the foundation to change course.

Factors such as political polarisation in the U.S. and the wars in Eastern Europe and the Middle East are pushing nonprofits to consider their niche, and how they might work with other groups, both on the corporate and philanthropic levels, Selig says.

“It leads to a little more sharing on the ground in what needs to be done,” he adds.

Steve Kaufer , founder of Massachusetts-headquartered e-commerce giving platform Give Freely and founder of TripAdvisor, says that the economy has a much bigger role in election years, as he looks to build and grow something that can act as a “counterbalance.”

“There’s a trend towards democratisation, and acting collectively can lead to greater impact,” he says.

Kaufer’s new platform hopes to leverage the everyday philanthropist through online shopping dollars to benefit major charity partners like UNICEF and charity:water, who earn funds as shoppers choose an organisation to benefit through an online clickthrough process.

“Whether a good year or bad year, e-commerce will continue to keep growing,” he says. “Nobody doubts that.”

Whether a legacy foundation, corporation or individual, the political landscape this year is requiring some to exercise caution as they consider what their own charitable actions might be and how it could be viewed more broadly. For the personal philanthropist, every move is now scrutinised more closely. On the nonprofit side, entities are exercising more due diligence to understand if a specific donor aligns with their mission and that there aren’t any underlying issues that could cause greater pushback.

“You have to be able to walk the walk,” Huston says. “For example, we’ve had to turn down very large donor checks from corporations because there’s a Reddit stream calling them out on their human rights practices.”

She adds that even a routine charity activation could now be aligned with a political party, and that adds complexities to how a higher-profile organisation like Six Degrees can activate, especially as the film Footloose turns 40 in 2024 (which Bacon starred in).

“A lot of organisations and states want to align themselves with this feel good moment, and we should be able to stand side by side with everyone, but we have to be aware,” she says.

Another topic attracting donor interest today is  mental health, an area that historically has been underfunded and under-resourced by philanthropy, according to Two Bridge partner Harris Schwartzberg, who has been closely linked to the mental health space for more than a decade.

Today, the issue for mental health nonprofits is less about resources and more about societal divisiveness and polarisation around the topic. There’s an “overwhelming demand” for solutions, but the space is in a “perfect storm” for the broader political issues to make things worse, Schwartzberg says.

In Curran’s opinion, the storms brewing are troublesome, but they are also creating new opportunities for corporate and personal giving. The  current state of philanthropy is one of “dynamic, expansive, and blurred lines,” meaning a careful blending of targeted giving combined with an understanding of the broader geopolitical landscape could lead to a successful overall philanthropic strategy.

“There are a lot of headlines that distract, but shouldn’t,” he says. “2024 needs more serious philanthropists than ever.”

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