All Forum Posts by: Jillian Sidoti

@Julian Buick - in other words, they are all about the penalties and fees. They have harsher laws and the enforce them. So, in the case of one client, they had found their brother in law listed as a lender on a deed of trust in the clerk's records. Knowing that brother in law wasn't an institutional lender, they looked up the borrower (my client) to see if they had filed a FORM D. They had not. So they hit him with a subpoena for all his records and eventually, a fine for not following securities laws. 

@Chip F. - there are very few states that have what is called a "self-executing exemption" for the sale of notes secured by real estate. Washington state is a horrible state that actually goes through the clerk records to find "non-traditional lenders" and then tracks down a borrower to hit the borrower with a fine. BEWARE. 

It can get costly to get an attorney involved in drafting something and helping with the form D filings, but it is the best insurance policy you will ever buy. What I always say to people "you can pay me a little money now and have a little stress or you can pay me a lot of money later and have a lot of stress." 

However, there is hope. In the next month, I hope to be launching a "Legal Zoom" type software for this very purpose. If you would like to be a beta tester, please let me know. 

@Brian Adams - I love stories like yours. Can I interview you for our YOUTUBE channel? 

@Tito Burgos - are you looking for a multifamily mentor? We have a couple as clients that I can introduce you to. 

@Sherman Ragland - if you don't mind, I can analyze your deal for people here. Otherwise, I will remove this comment. 

I help build crowdfunding sites, do Regulation A+ offerings, and have a lot of clients listed on a variety of sites. 

I have invested in the following sites: Fundrise (2 506(c) offerings and 2 of their E-REITS), RealtyMogul, Crowdstreet (506(c) offerings), Groundfloor (506(c) offerings - smaller deals). I have signed up for a bunch of other sites and haven't invested. 

My favorite, by far, is Fundrise. Their platform is easy to use, I like the way they operate, they have a DRIP. 

I most likely won't invest on Groundfloor again - at least not for the foreseeable future. I am bearish on the SFR market and have lost money on Groundfloor - not a lot - but I have lost money. In the effort of full disclosure - I also made money on Groundfloor.

I keep hearing what Bryan is saying about "the best are not on crowdfunding platforms." Although, I am not ready to agree with this statement, I will say that my best clients (506(c) and Regulation A+) are "doing it on their own." In other words, they are doing their own marketing campaigns, raising money on their own sites, etc.  

EDIT: I went through my client list. I am going to say it is truly 50/50. We have some heavy hitters that use CF platforms just for the marketing aspect of it - even if they are doing fine on their own with raising capital. 

So, I think the best advice I can give is as follows: read the docs and know what to look for. Also, know what you want to invest in. I have learned, very recently to CALM DOWN. Someone in my position, I see a lot of "great deals" so it is very easy to get distracted by one type of asset class over another. I recently received some great advice from one of my clients, Scott Meyers: focus. This doesn't mean that the focus can't change, just that you should very much focus on one asset class at a time. So, how does one diversify? The market will tell you that and when to buy what. 

Hi - please feel free to connect with me. I am currently writing a lengthy article on how to read a private placement and what you, as an investor, should look for. When it is ready, I am happy to send it to you.

Also, if you are looking for a specific something, I can most certainly introduce you to some of my clients with deals. I do not make anything or have any advantage if you choose to invest, nor do my clients expect me to introduce them to investors. I just do it to put people together if the relationship makes sense. 

Last try on giving you the chart! I hope this helps. I hope this doesn't get removed. Let me know if you have questions. 

@Brian Burke your advice is spot on, however, I tend to discourage people from starting a debt fund. I usually prefer to encourage an equity fund with a preferred return so that it looks like debt but doesn't put unnecessary pressure on the syndicator/manager. The pressure of HAVING to make an interest payment can ruin the deal for everyone (potentially) as opposed to paying a solid return in the event the cash flow is there to make the return. 

Which brings us to the biggest mistake first time syndicators make: offering too much to the investors. If you are confident that your returns will be 10% ROI, that doesn't mean you offer 10% ROI to your investors - instead, offer a number you KNOW you can reach. When you offer 8% and pay 9%, everyone is happy. However, if you offer 10% and only pay 9%, everyone is angry. Managing expectations is key.

 Jaime, like Bryan said, you don't need someone in New England specifically as you really want to try to work with a federal exemption under the Securities Act of 1933. I am from Boston, but I live in so Cal. However, New England, particularly NH and MA, have BRUTAL securities laws. It is super important in those states to make sure you provide adequate disclosure to your investors because the securities board in those states will go after you with a vengeance.