How Tangible Assets Built Barbara Corcoran’s Multi-Million Dollar Portfolio

Barbara Corcoran, a real estate mogul and star investor on “Shark Tank”, has built a powerful investment portfolio by focusing on tangible assets such as real estate, small businesses and consumer products with real-world value. Unlike many investors who chase tech stocks or speculative ventures, Corcoran’s approach centers on physical investments that serve everyday needs and have long-term growth potential.

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Her strategy has led to massive returns, including one investment that turned $50,000 into nearly $468 million. This could explain why she currently has an estimated net worth of $100 million. From real estate to innovative startups, Corcoran’s portfolio is a masterclass in building wealth through tangible assets.

Corcoran’s journey into real estate began in the early 1970s: After working several odd jobs, she borrowed $1,000 from a former boyfriend to start a small real estate agency in New York City called the Corcoran Group.

In 1981, Corcoran published the first real estate market report, named the “Corcoran Report,” providing other agents and investors with insights into New York’s real estate trends. The “Corcoran Report” helped establish her authority in the industry and attracted high-end clients.

Over nearly three decades, the Corcoran Group grew into one of New York’s largest and most successful real estate firms. In 2001, Corcoran sold her company for a reported $66 million.

This was the capital that she later used to pursue other ventures, including her role on “Shark Tank.”

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Corcoran follows two key rules when investing in real estate:

• Rule 1: Her first rule is to buy property with a 20% down payment. She believes this approach keeps monthly mortgage payments at a manageable level.

• Rule 2: Her second rule is to aim to break even in the first year of owning the property. Corcoran looks for investments where the rental income covers the mortgage and other monthly expenses right from the start: “If I break even, I’m smiling all the way to the bank.”

Breaking even early on is a positive sign that the property will become profitable in the following years. As time goes on, she expects property values to rise and rental income to increase, leading to greater earnings.

Corcoran also advises against taking money out of investment properties too soon: “You cripple your business if you start taking money out.” Instead, she suggests allowing the investment to grow in value and mature before tapping into the profits.

Corcoran has invested more than $5.5 million during her time on “Shark Tank,” and according to her, 90% of those businesses have lost her money. That can often be the case with early-stage startups and small businesses. However, this doesn’t mean Corcoran has actually lost money on “Shark Tank.” In fact, the businesses that have succeeded have given her large enough returns to offset the losses — many times over.

One of Corcoran’s most successful “Shark Tank” investments was The Comfy, a wearable blanket. Even though no one else on the panel was interested, Corcoran chose to put $50,000 into the company in exchange for a one-third ownership stake.

According to Corcoran, the investment was wildly profitable: In three years, the company had made her around $468 million. This comes out to a 936,000% return in just three years, a scale of profit that most stock investors can only dream of.

This is an example of the types of investments that have made Corcoran much of her money: simple, tangible products in which she sees the potential value for the regular consumer.

Another one of Corcoran’s notable investments is Grace and Lace, a company that started by creating hand-knit socks. Believing in its potential, she invested $175,000 in exchange for a 10% stake. She was right — both the products and the company’s commitment to donate a portion of its profits to building orphanages in India resonated with consumers. Grace and Lace has since increased its revenue to more than $50 million annually.

While the products are important, Corcoran has said that she also pays close attention to the entrepreneurs behind them. She looks for capable, hardworking individuals who can hit the finish line with a business. When she invests, she also focuses on providing mentorship, helping business owners navigate their challenges to grow their companies.

Caitlyn Moorhead contributed to the reporting for this article.

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This article originally appeared on GOBankingRates.com: How Tangible Assets Built Barbara Corcoran’s Multi-Million Dollar Portfolio