Private Placement Memorandum- Do I need one in this scenario?

[Samuel S.]

Hey BP Folks,

So I am going to be starting a syndication to raise $100K, where there would be no more than 10 investors, all of whom I would know personally.  Some would be accredited investors, whereas other might not be.  We would each be putting in $10K, so I will have some skin in the game.    

The goal of the fund would be to:

• Buy a distressed multi family property
• Add value
• Rent out
• Appraise, cash out refi, and rinse/repeat

Would this strategy require a private placement memorandum?  I would not plan to add any other investors into the group, and those investing would not be willing to personally guarantee anything.  They would simply be looking to receive a return on their investment, similar to an "angel investor".  

My understanding is that I would need set up an LLC, where I would be the only active manager, and thus the only one personally guaranteeing any refinance loan.

Any advice would be greatly appreciated!!

[Jay Hinrichs]

@Samuel S.@Chris Soignier  there is a specific PPM dedicated  for 1 mil and under..

I don't think the 1 mil and under exempts you from PPM .. just depends on how you set it up.

100k is pretty small number to pay for a ppm  ... maybe you just have the few buddies give you unsecured prom notes.. that may work.