All Forum Posts by: Jillian Sidoti

I have a bunch of other questions for you too: are you offering each of these people debt or equity in the deal? Or a combination? What about using a shared appreciation mortgage for each deal and avoid having to create an LLC every time or creating a "LOCAL" LLC in the areas where you are flipping? If you do a SAM, you might avoid a lot of this while still providing the equity increase that you want for the investor.

HI Victoria - if you live in California and you have California investors, my advice is to form in California. A series LLC will do you no good here as you will need to register each individual series within the state of California. They love their pound of flesh. In 2012, they closed any loopholes available to stay outside of the state of California if you live within the state and own at least 30% of the LLC (or at least 30% of the LLC is owned by CA residents.) I hope this helps.

I know people that have. What are you trying to do, Matt? 

Our firm is hosting a great event where you can get all the resources and education you need to fund your next deal. PM me and I will give you a special code to get $300 off. www.crowdconvergecon.com. It is in Vegas on 2/2 and 2/3. Thanks! Hope to see you there.

Sign up for the early bird price at www.crowdconvergecon.com until 12/31

Why Crowdfunding? 

If you are having a hard time raising money for your deals, come learn how to crowdfund at CrowdConverge 2017. Platforms, investors, real estate entrepreneurs and more will all be attending CrowdConverge 2017 to get deals funded. 

Why Attend CrowdConverge?

At CrowdConverge 2017, you’ll network with business owners at nearly every stage of development, including start-ups, emerging business and growth-stage companies, all looking to launch their ideas and platforms to each other and to you. The purpose of this event is to help foster your relationship with these companies, and is your chance to build your relationship with organizations that need your feedback. In the process, you will meet with issuers and new platforms, help establish your own company’s position in a booming market, increase awareness of your brand and build key relationships. You will also have access to our marketing high-powered sessions, which will give you the tried and true techniques to succeed in crowdfunding.

I know I am late to the party, but I am a securities attorney, so maybe I can help. 

Here is the test. If you answer YES to all of these (regardless of number of investors) you have to do some work to be compliant:

1. Is there an investment of money?

2. Is there more than 1 investor? 

3. Do the investors expect profits on their money (dividends, distributions, or interest)?

4. Are you in control of the property/project/entity?

Let me know if I can help further!

We are so excited about Reg A+  here. 

Great news for capital formation - this morning the SEC approved the rules for Reg A+, aka Title IV of the JOBS Act!

More detailed overview coming soon, but some quick details...

When: rules become effective in 60 days.

What: There are 2 "tiers"
Tier 1 - requires SEC and state blue sky reviews & fees, raise up to $20M per year, open to unaccredited investors, no audit required
Tier 2 - requires SEC review but no state blue-sky review ("preemption"), raise up to $50M per year, also open to unaccredited investors (limited to the greater of 10% of income or net worth), annual audit required, must use a registered transfer agent (FundAmerica will be helping to simplify this for issuers)
Both - are open to unaccredited investors, can be used by startups as well as existing businesses, and are exempt from 12(g) registration thresholds

How: Preprare offering doc's, get your audit done, use "form 8a short-form", submit draft offering to SEC, filing electronically via EDGAR

Compare to 506(c) - takes way more time to launch an offering, and far more costly in terms of legal fees, accounting costs, and annual reporting obligations. However, it enables you to sell to unaccredited investors and creates a tradable security.

Our firm has done Reg A's before - the blue skying is the WORST. So this is very refreshing to not have to blue sky the materials. It will make it so much easier for investors and entrepreneurs alike. Let me know if you have any questions! I am happy to answer them.

I am in the process of bringing one of these companies public. The industry is literally blowing up. I am excited to see how this turns out. They currently own property in Colorado for marijuana cultivation and we have specifically separated the "cultivation" from the real estate ownership to protect assets. 

Any hard money worth their...well, money, would not DARE take you up on your offer. It's most likely against the SAFE Act and would land the lender in tons of trouble. 

Kevin, Have you gone to a commercial bank? Where is this? PA?