Drift Capital: A fund to invest in collector cars?

What’s a solid investment these days? Stocks? Mutual funds? Bonds? Your friend’s coffee shop? 

Well, how about classic cars? Not any old classic car, but the blue chip cars, the million-dollar ones. Too pricy for your taste? Not necessarily. Drift Capital offers a way to invest into this fund of not only one car from the upper echelon but a whole collection.

This is the brainchild of Eden Cooper, an automotive enthusiast, angel investor and a CFA. “We’ve all seen these cars go up enormously in price, particularly at the high end of the spectrum,” he explains. “If you’re one of the lucky 499 folks who get a La Ferrari, to be able to purchase it, enjoy it for a few years and turn it around for a profit–I was like, how do I do that? 

“I came across a white paper from a research student out of the University of Amsterdam that proposed such a question: ‘Are collectible cars the next internal investment class?’ I worked with him alongside a few other professors and colleagues to see if there was [anything] there. The data said yes.”

Currently the collection has a “few cars,” says Eden, but they’re actively negotiating the purchase of about a “dozen or so cars.” The goal is to have a fund size of about $50 to $75 million, with the average price of a car in the collection being $2.5 million. The fund requires a minimum investment in the low six figures, but still less than the vehicles themselves are worth.

How to keep the vehicles from being moved–or worse? This requires a level of trust in the firm, and Eden says he built a team of experts, both on the automotive side and the financial side.

“Our goal is not to take these works of art and put them in some dusty old garage,” Eden says. “I hate when people jump to that sort of conclusion. Our goal is to have these fully on display, hopefully in some type of nonprofit museum, where we can tell the stories, put on events and continue the legacy and education and excitement for the next generation of automotive enthusiasts.”

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