Any privately held corporation or limited liability company in the United States that intends to offer any equity in the form of selling stocks or membership units to a friend, relative, employee, associate, private investor, angel investor or venture capitalists is prohibited from doing such without the appropriate Security and Exchange Commission (SEC) Exemption.  The Exemptions are known as Reg D Series Offerings and depending on the amount to be raised will determine which series will be designated. Most commonly the offerings are Reg D 504, 505 or 506.

The SEC defines this act as a securities offering and the Offeree must be in compliance with the proper Regulation D Series memorandum that is required to be provided to a prospective investor and additionally follow the particular restrictions of that offering.

Any SEC violation could be punishable by fines and/or prosecution for criminal acts. The officers, directors or managing members could be personally liable and responsible for the violations of the company.

• Estimates are that over $1 trillion will be raised through private placement offering in 2010.
• Private investors do not expect unreasonable returns.
• Any business entity in nearly every industry can utilize a private placement offering to raise capital.
• No individual credit checks or requirements necessary.
• A properly prepared private placement offering and memorandum can captures the attention and impress a private investor.
• A standard private placement offering is cost effective and economical.
• In most instances, the company has immediate access to funds raised.
• Professional broker/dealers are available to assist in the promotions, sales and placement of private placement offerings.
• Usually a company is marketing its offering within a matter of weeks after contracting for the preparation services.
• No stressful monthly installment payments as in a loan from a bank or individual.
• So long as the company is in full SEC compliance, there are no personal liabilities or risks to officers, directors or other individuals associated with the offering.
• A great way to finance a company if the needs are from $1 million to $10 millions.
• Private investors & institutions are more secured owning stocks and membership units.

How do I qualify for a Private Placement Offering?

It is suggested that anyone entering into a private placement offering consult with someone that has experiences in the field whether that be a SEC consultant, SEC broker or SEC attorney. Have some degree of fundamental understand of the regulations, guidelines and laws associated with an offering. Be familiar with the basic procedural steps that must be taken before the capital is raised.

• A Complete and Comprehensive Business Plan or Executive Summary
• Private Placement Memorandum (PPM)
• Formation of Limited Liability Company (LLC) or Articles of Incorporation
• Employee Identification Number (EIN)
• Limited Liability Regulations and Operating Agreement
• Security Exchange Commission (SEC) Form D
• Subscription Agreement
• Marketing Tools

Where does the money come from?

There are many sources of capital available to those who know how to find it and properly represent the offering in a professional and compliance manner. Some of those ways are:

• Small Company Offering Registration (SCOR) – under SEC Reg D
• Direct Public Offering (DPO)
• Investment Bankers
• Informal Angel Capital Investors (AC)
• Formal Venture Capital Funds (VC)
• Small Business Investment Companies (SBIC)
• Investment Clubs
• Foreign Investors
• Broker/Dealer Investor Client Base

When it comes to a private placement offering and the regulations concerning solicitation laws, you really must know what you are doing so that you don’t cross the line.

If you think for one moment a place you DON’T want to visit for several years, I think most reasonable people would agree it’s JAIL.  Waking up next to convicted felons named Big Al and eating a cold breakfast doesn’t sound appealing to me.

You might say it sounds rather extreme, but one mistake during a conversation about private placement offering can lead to the infamous “knock on the door”.  As with any other investment market, there are laws for brokering private placement, AND consequences for breaking the regulations and laws.

To better understand the laws that concerns solicitation, let’s define the word “solicitation” and how the term applies to private placement investments. Solicitation means approaching any individual with the intent to discuss and sale an idea, service, or opportunity. When it comes to a private placement offering, it is considered solicitation to promote or even talk about your business in regards to your memorandum, projections or earning claims before you have delivered your full compliance package. That means no advertising on Craigslist, Linkedin, Facebook or any of the many social business networking sites.

Before you send out a memorandum to a potential investor, you MUST have that individual request the offering. The moment the individual states, “I’d like to see your offering”, it is no longer solicitation. In speaking with a potential investor, NEVER guarantee any returns on the investment. Don’t sugarcoat the information you are providing to the potential investor. Always use disclaimer in communicating either verbally or by e-mail. A good disclaimer in an e-mail might be:

“You are NOT an investment advisor, and that NO information you provide should be considered a solicitation.”

Always avoid any misrepresentations of yourself to the potential investor. Other words, NEVER LIE. Be truthful and honest in all statement avoid any form of deception.

Though it may be easier to paint a rosy picture for investors, the truth is always uncovered as the transaction unfolds.  No one appreciates the “bait and switch” technique, and as you know, ANYONE can file criminal complaints or sue you.  Remember, having a private placement offering investor submit an application is great, but NOT if they are expecting something you can’t provide.  Having applications that don’t close does nothing but degrade your reputation, and in such a fraud polluted business, that is all you really have.

In summary, if you have honest conversations outlining realistic expectations and worst case scenarios, you will ALWAYS be more productive in the end.  Keep it truthful, legal, short, and sweet, and you will surround yourself with people of similar ethics in return.

Anyone who is considering starting a new business must analyze the cost and expenses associated with the start up operations. For the business owner who wants to expand an existing business that requires additional capitalization also needs to weigh the various costs and liabilities.

Being under capitalized is one of the most common mistakes business owners make. Attempting to work on a financial shoe string is not only stressful but can impede the growth of the business for years.

The very first step that most companies take when seeking private capital is the creation of an executive summary and/or a business plan. While executive summaries and business plans are an important facet of raising capital they are not designed to be investment documents.

Executive Summaries and Business plans typically just provide general information about the company, its business model, goals, etc. While this information is important to investors, it does not provide a basis or structure for accepting capital investment.

A business plan does not allow a company to accommodate multiple individual investors. Most business plans state an aggregate amount of funding needed, “$500,000″ for example, but provide no structure to allow for fractional investment. This means the company must find one single investor with $500,000 to invest – and the patience to develop the transaction structure and documents to process that investment. This limitation is probably the single biggest reason why so many companies fail at raising investor capital. Raising capital effectively and properly from investors requires very specific documentation that far surpasses what a business plan provides.

Public companies don’t raise capital from investors by putting a business plan in front of them. If you wanted to invest into Dell Computer – do you think Dell would send you a business plan to process your investment? Of course not – you would invest into Dell Computer through a securities offering. The same holds true for private companies seeking capital from investors. Don’t expect an investor to invest unless you have presented them with a securities offering. Business plans serve a purpose (especially for start-up companies) – but they should not be relied upon as investment documents.

Here is the “Best Kept Secret in Funding.”  The Regulation D series of funding can allow you to legally in compliance with Security & Exchange Commissions laws raise the funds necessary for your business with a short period of time. Whether it’s a few hundred thousands of dollars or millions, there is a Reg D  to answer your requirements.

If you intend to offer equity in a privately held company such as a corporation or limited liability company, then you must have the proper exemption from the Securities & Exchange Commission or you’ll be in violation of offering a securities. The Reg D series of private placement offerings are the exemptions. For individuals needing $1 million or less, the Reg D 504 Private Placement Offering is ideal. It’s very cost effective and easy to comply with only a few restrictions. For those needing over $1 million, the Reg D 506 is commonly used.

You owe it to yourself to learn about this method of raising funds for literally any type of business.

The buzz words today are “private investing in business offerings”. Since the majority of private investors still lack confidence in the stock and housing markets they are researching and turning to investment opportunities in business projects, start ups, various business concepts, existing businesses and most of all franchisor companies.

For decades entrepreneurs have successfully used private placement offerings to fund their businesses with capital and for years, accredited private investors have experienced the benefits of these offerings whereby the company offers a minority equity position through the sale of stocks or membership units. Private placement offerings are risky but when an investment becomes a “home run”, the rewards are tremendous with returns sometimes hundreds of times the initial investment.  Some investors seek out companies that intend to be acquired or will consider an IPO within a short period of time. The company uses the private placement offering for seed capital while others are for business expansion.

Predictions for 2010 are that over $1 trillion dollars will be raised through private placement offerings. In 2007, $600 billion was achieved therefore you can see the growth of these types of offerings.

All private placement offerings are regulated by the Security & Exchange Commission and require the company making the offering to have the proper exemption in the form of a Reg D memorandum.  Depending on the amount being raised will determine the Reg D exemption. For a company raising less than $1 million, a Reg D 504 most likely will be used. For those companies seeking more than $1 million, a Reg D 506 would most likely be used. In addition to the federal SEC guidelines and regulations nearly every State has laws to protect the investor. This is why many private investors like investing. There are penalties, fines and even criminal prosecution for individuals who misrepresent and/or commit fraud in the offering.

Profran Consultants, Inc. works with approximately one hundred individuals each year who offers private placement offerings to investors.  Since 1982, Ken Hollowell, CEO/President of Profran Consultants has experiences in this arena.  Mr. Hollowell guides his clients through the regulations, guidelines and requirements preparing the proper memorandum to be offered along with preparation of the promotional and marketing materials. In addition, Mr. Hollowell coaches and teaches the client in ways to find and approach private investors. His client’s success rates are among the highest in the industry. The range of industries are from retail, manufacturing, technology, environment friendly, real estate, mortgage, automotive, health care, entertainment, and franchise companies to name a view.

For more information on existing investment opportunities or funding your company, e-mail info@regdconsultant.com or call Mr. Hollowell at (407) 363-3545.

There are three primary SEC Regulation D Programs that offer support for; the Regulation D 504 Offering, Regulation D 506 Offering, and the Small Corporate Offering Registration (“SCOR”) Offering.

Determining which program best suits your company is based primarily on transaction size. We normally recommend the standard 504 or 506 offering programs (not SCOR) for most companies.

Regulation D 504 Offerings are typically used for transactions under $1,000,000 in size.

Regulation D 506 Offerings are used for offering over $1,000,000.

504 Program

Regulation D 504 Offering: allows companies to raise up to a maximum of $1,000,000 in a 12 month period – the exemption is renewable meaning the company can use the 504 program again 6 months from their last securities sale under 504.

The 504 is the least restrictive of the Regulation D programs regarding structure, financials, disclosure, and investor suitability. A 504 offering allows a company to sell securities to an unlimited number of purchasers without regard to their sophistication or experience – although some States may limit the company to 35 non-accredited investors while still allowing an unlimited number of accredited investors.

The 504 is the most popular and widely used of the Regulation D programs. Many companies use 504 for an initial round and then float a 506 for a larger second round – both offerings can be done in a 1 year period because they are separate exemption programs.

The 504 program is available for private corporations only. Public reporting companies cannot use the 504 program.

The 504 program is regulated at the Federal level and State level (the State the investor resides). Companies using the 504 program must file a Form D notification filing with the SEC (included in our service) and may be subject to informational filings at the State level depending on the residency of the investor. We have streamlined the State filing process – most companies only need to file in 1-5 States to sell out a 504 offering.

506 Program

Regulation D 506 Offering: allows companies to raise capital through the sale of securities with no principal amount cap per 12 months. The 506 program provides an exemption for limited offers and sales of securities without regard to the dollar amount of the offering. Most companies use the 506 program to raise amounts from $1,000,000 up to $50,000,000 – although there is no cap on how much capital can be raised via a 506.

506 offerings have basic disclosure requirements regarding transaction and company details – our PPM documents exceed the Federal minimum disclosure level. Only financial statements for the most recent fiscal year need to be certified by an independent public accountant. If an issuer cannot obtain audited financial statements without unreasonable effort or expense, or if the company is a start-up with no operating history, only the issuer’s balance sheet (to be dated within 120 days of the start of the offering) must be audited. An issuer can forgo providing audited financial information if the offering is made solely to accredited investors or if the information on the balance sheet is not material to the investment decision.

A 506 offering allows up to 35 non-accredited investors and an unlimited number of accredited investors. 506′s are exempt from State securities laws – the Federal regulations supersedes the State rules, however most States will want a copy of the Form D submitted if you are selling securities to investors that reside in their State. As with the 504 program a company must file Form D in conjunction with a 506 offering to notify the SEC of the offering.

SCOR Program

Small Corporate Offering Registration (“SCOR”) Offering: The SCOR is a more complex version of the 504 offering. The SCOR offering provides a standardized disclosure format that is accepted by 43 States and allows increased freedom of solicitation and advertising over the standard Regulation D 504 exempt program. The standardized disclosure format (the U-7 form) also allows the company to comply with a large number of individual States securities laws utilizing one regional review instead of filing the offering with each individual State the company sells securities in.

The SCOR does require audited financial statements for the past 2 fiscal years for offerings exceeding $500,000 and has a maximum 12 month cap of $1,000,000. You must also have 10% equity relative to the amount of capital you are raising through the offering. We typically recommend the standard 504 over SCOR due to its lack of restrictions, its ease of implementation, and its use of the more sophisticated and professional PPM disclosure document. The SCOR U-7 disclosure document is a question and answer document that we do not feel is very professional in its appearance to investors.

If you have any questions about whether a SCOR or 504 would be best for your transaction please feel free to call us directly to discuss specifics.

There are several programs that are available under the Regulation D Exemption. Of the available Regulation D Programs we support the 504, 506 and SCOR programs. Most companies typically use the 504 and 506 programs – which program you utilize is based primarily on transaction size. Detailed information on each program can be found in the gray menu on the right.

There are 2 basic types of Regulation D Offerings that can be structured; an “equity” offering where the company is selling partial ownership in the company (via the sale of stock or a membership unit) to raise capital – or a “debt” offering where the company raises debt financing by selling a note instrument to investors with a set annual rate of return and a maturity date that dictates when the funds will be paid back to investors in full.

Offering Types – Debt or Equity

An equity offering is where the subject company sells an ownership stake in the company to investors. Equity is usually preferred by early stage companies that need flexibility regarding capitalization. In an equity situation investors profit as the company profits since they are partial owners. This provides the advantage of not having a debt service payment draining revenue from the company in its early stages of growth. Most companies sell 10-30% of their company for a first round funding – obviously there are exceptions but this is the average. We recommend using either a “C” Corporation (where you would sell stock to investors) or a Limited Liability Corporation LLC (where you sell a membership unit to investors). Investors typically profit in two ways from an equity deal; via their proportionate “per share” percentage of company profit (called a dividend) and via the final sale of the security through an exit strategy (example: the company buying the securities back from the investors, the company and its issued and outstanding securities being bought out by another company, going public and selling on the open market, etc.)

A debt offering functions much like a private business loan where the company sells a promissory note to investors. The note sets forth the terms and conditions of the loan arrangement between the company and the investor. Thus a note would provide a certain interest rate typically paid annually to investors with a maturity date that dictates when the principal is paid back in full to investors. The notes are sold in fractional amounts providing flexibility for accommodating investors – thus a typical debt offering for $100,000 would be the sale of 20 notes at $5,000 per note. An investor investing $10,000 would get two notes. If the interest rate was 12% then he would get $1,200 paid to him annually based on the $10,000 investment. If the maturity date was 36 months then at the end of the 36 months the company would pay back the $10,000 to the investor. Many early stage companies that lack the required equity or operating history for conventional bank financing will use private debt from investors for a short period of time (12-36 months) to establish a credit and operating history. They then have the capability to take out the private debt loan from the investors with a standard bank business loan at a lower interest rate.

Any private company or entrepreneur that is seeking to raise equity capital or private debt financing from investors should have a securities offering in place. Only a securities offering can provide the needed practical framework to accommodate investment.

Even if your transaction will only involve one or two investors – you still need to provide the proper transaction framework, disclosure documentation and investment agreements necessary for raising capital. Raising capital from investors, debt or equity, of any amount requires very specific documentation that far surpasses what a business plan provides. It is imperative that a company seeking capital from investors have in place a Private Placement Memorandum, a Subscription Agreement, and in debt offerings a Promissory Note Agreement. Raising capital without these documents is nearly impossible – they are a necessity.

You also need to use an SEC program, like Regulation D, to properly sell your company’s securities to the investors. The SEC and States have specific rules concerning how a private company solicits capital from investors – even if very few investors are involved. The Regulation D Offering program is the exemption program designed by the SEC for private business. It is the most widely used program the SEC offers and provides the proper exemption needed to raise capital from investors. Not raising capital properly can provide investors with a “right of rescission” in the future – meaning they can get their investment back regardless of the circumstances. You could also face fines and other penalties resulting from an improper sale of securities to investors.

The Regulation D Offering Programs are typically utilized to raise from $25,000 to $50,000,000 in capital. Regulation D Offerings are used for a wide variety of transaction and industry types: corporate seed capital, corporate expansion capital, film production capital, real estate equity funding (acquisitions, development projects, golf courses, rehab), capitalization for early to pre-IPO stage Internet and technology companies, expansion funding for retail companies, and product development and distribution funding.

A Regulation D Offering provides the fundamentals for raising capital from investors – regardless of your industry type, age of your company, or the size of your organization.

How to Raise Capital from Investors

The very first step that most companies take when seeking private capital is the creation of an executive summary and a business plan. While executive summaries and business plans are an important facet of raising capital they are not designed to be investment documents.

Executive Summaries and Business plans typically just provide general information about the company, its business model, goals, etc. While this information is important to investors, it does not provide a basis or structure for accepting capital investment.

A business plan does not allow a company to accommodate multiple individual investors. Most business plans state an aggregate amount of funding needed, “$500,000″ for example, but provide no structure to allow for fractional investment. This means the company must find one single investor with $500,000 to invest – and the patience to develop the transaction structure and documents to process that investment. This limitation is probably the single biggest reason why so many companies fail at raising investor capital. Raising capital effectively and properly from investors requires very specific documentation that far surpasses what a business plan provides.

Public companies don’t raise capital from investors by putting a business plan in front of them. If you wanted to invest into Dell Computer – do you think Dell would send you a business plan to process your investment? Of course not – you would invest into Dell Computer through a securities offering. The same holds true for private companies seeking capital from investors. Don’t expect an investor to invest unless you have presented them with a securities offering. Business plans serve a purpose (especially for start-up companies) – but they should not be relied upon as investment documents.

The Fundamentals of Raising Investor Capital

There are certain fundamentals that you must have in place in order to raise any amount of capital from investors properly (whether it be one investor or one hundred):

First, you must have proper transaction structure in place before you interact with investors. The overwhelming majority of companies that are just using a business plan to raise capital (whether for $50,000 or $15,000,000) typically have very little transaction structure beyond “we’re selling 20% of the company for $2,000,000″. This is wholly inadequate.

How many shares or units are being sold? Preferred return or common ownership? What is the share/unit price? What is the total authorized share/unit pool and how will it affect future dilution of the investment? What is the exit strategy? How is the investor return modeled? Are the securities convertible?

Not addressing this information places the responsibility for creating proper transaction structure on the investor – which is very unprofessional and reflects poorly on the subject company. To raise private capital successfully you need to go well beyond simply stating to investors an aggregate amount of capital needed and providing information on the business. Do not expect investors to have any interest in your opportunity without providing them concise terms and conditions regarding their capital investment in your company. If you were an investor – would you not want the same information and structure provided for your investment?

Second, proper documentation for raising capital from investors is of critical importance. A business plan is not even the bare minimum needed for raising private funding – of any amount. The specific documents needed for raising private capital are:

• Private Placement Memorandum: The Private Placement Memorandum, or “PPM”, is the document that discloses all pertinent information to the investors about the company, proposed company operations, the transaction structure (whether you are selling equity ownership or raising debt financing from the investors), the terms of the investment (share price, note amounts, maturity dates, etc.), risks the investors may face, etc. Do not confuse the detailed corporate disclosures, SEC disclosures, and transaction structure in a PPM with the general information a business plan provides – they are not the same.

• ·    Subscription Agreement: Business plans do not even provide the documentation necessary to allow the investor to actually invest. Don’t expect investors to provide you funding based on a handshake. Would you invest funds into a company without signing a document that sets forth the terms and conditions of the investment? The Subscription Agreement sets forth these terms and conditions – this is the document the investor signs and returns to you with their investment check. You will have a very hard time raising debt or equity capital without this basic document.

• ·    Promissory Note: In debt offerings you need to have a Promissory Note outlining the terms of the loan arrangement with the investors. The note is the actual “loan document” between the company and the investor. It is impossible to have a “loan” without a “loan agreement” that sets forth the terms and conditions of the loan.

Third, in order to sell securities to investors you must follow the rules and regulations that govern these sales as set forth by the Securities and Exchange Commission and State securities regulators. The SEC has specific rules concerning how a private company solicits capital from investors – even if very few investors are involved. The Regulation D Offering program is the exemption program designed by the SEC for private business. It is the most widely used program the SEC offers and provides the proper exemption needed to raise capital from investors. Not raising capital properly can provide investors with a “right of rescission” in the future – meaning they can get their investment back regardless of the circumstances.

Don’t rely on your business plan to perform a function it was not designed to accomplish. Let us structure a Regulation D securities offering for your transaction and begin raising capital the right way.

No doubt you have heard people who have attempted to raise money for their startup companies state many nightmares they encountered in dealing with investors. The general consensus among individuals wanting funding from investors is “they beat you up” and “they want more from me than I am willing to give”.

Those are common statements from individuals unprepared to discuss with investors their opportunity and deal. The biggest mistake a person makes is when they approach a potential investor with only a business plan. A business plan is important and has its place among the tools of the business owner but to use the business plan solely for the raising of money is usually disastrous. Business plan should never be used solely for raising funds because they are not designed for such use.

Business plans provide basic and general information about the company and concept of the businesses. Investors appreciate business plans but it does not provide the structure for the raising of money. Neither does the business plan address the need for multiple investors. Merely stating the amount required or needed does not provide the structure for the raising of the money.

The business plan and this weakness is probably the one reason why so many companies fall short in their attempts to raise capital from investors. Raising capital effectively and properly from investors requires very specific documentation that far surpasses what a business plan provides. Public companies don’t raise capital from investors by putting a business plan in front of potential investors. The same holds true for private companies seeking capital from investors. Don’t expect an investor to invest unless you have presented them with a securities offering such as a REG D 504 or 506 Private Placement Memorandum. Business plans serve a purpose (especially for start-up companies) – but they should not be relied upon as investment documents.

How to Properly Raise Capital for your Business

There are certain fundamentals that you must have in place in order to raise any amount of capital from investors properly (whether it be one investor or one hundred):

First, you must have proper transaction structure in place before you interact with investors. The overwhelming majority of companies that are just using a business plan to raise capital (whether for $50,000 or $1,000,000) typically have very little transaction structure beyond “we’re selling 20% of the company for $1,000,000″. This is wholly inadequate.

How many shares or units are being sold? Preferred return or common ownership? What is the share/unit price? What is the total authorized share/unit pool and how will it affect future dilution of the investment? What is the exit strategy? How is the investor return modeled? Are the securities convertible?

Not addressing this information places the responsibility for creating proper transaction structure on the investor – which is very unprofessional and reflects poorly on the subject company. To raise private capital successfully you need to go well beyond simply stating to investors an aggregate amount of capital needed and providing information on the business. Do not expect investors to have any interest in your opportunity without providing them concise terms and conditions regarding their capital investment in your company. If you were an investor – would you not want the same information and structure provided for your investment?

Second, proper documentation for raising capital from investors is of critical importance. A business plan is not even the bare minimum needed for raising private funding – of any amount. The specific documents needed for raising private capital are:

Private Placement Memorandum: The Private Placement Memorandum, or “PPM”, is the document that discloses all pertinent information to the investors about the company, proposed company operations, the transaction structure (whether you are selling equity ownership or raising debt financing from the investors), the terms of the investment (share price, note amounts, maturity dates, etc.), risks the investors may face, etc. Do not confuse the detailed corporate disclosures, SEC disclosures, and transaction structure in a PPM with the general information a business plan provides – they are not the same.

Subscription Agreement: Business plans do not even provide the documentation necessary to allow the investor to actually invest. Don’t expect investors to provide you funding based on a handshake. Would you invest funds into a company without signing a document that sets forth the terms and conditions of the investment? The Subscription Agreement sets forth these terms and conditions – this is the document the investor signs and returns to you with their investment check. You will have a very hard time raising debt or equity capital without this basic document.

Third, in order to sell securities to investors you must follow the rules and regulations that govern these sales as set forth by the Securities and Exchange Commission and State securities regulators. The SEC has specific rules concerning how a private company solicits capital from investors – even if very few investors are involved. The Regulation D Offering program is the exemption program designed by the SEC for private business. It is the most widely used program the SEC offers and provides the proper exemption needed to raise capital from investors. Not raising capital properly can provide investors with a “right of rescission” in the future – meaning they can get their investment back regardless of the circumstances. Don’t rely on your business plan to perform a function it was not designed to accomplish. Structure a Regulation D securities offering for your transaction and begin raising capital the right way.

Caution To All Entrepreneurs!

Every day I am speaking with individuals who intend to raise money with their existing corporation or Limited Liability Company (LLC) who are completely convinced they can raise any amount of money they want using a business plan through private sources.

If you are one of these people, I strongly recommend that you research and read this information immediately.

There are many web sites and self proclaimed “GURUS” that are leading people to believe that YOU can LEGALLY raise money from private individuals (or “angle”) investors without having to comply with or “worry about” SEC (Security and Exchange Commission) regulations.

Those web sites and gurus are wrong. And following their advice puts you in jeopardy of losing your business, house and bank account as well as possible fines and sanctions from the SEC and other serious legal consequences. There are specific rules that must be followed.

For 23 years I’ve been helping business owners fund their companies and projects legally and within the regulations of the SEC.

I use a method that I consider one of the BEST KEPT SECRET IN BUSINESS FUNDING. If a company is either a corporation or LLC and intend to use their STOCK or UNITS to fund their company, I prepare the necessary documentation that exempts the company from violating the Security & Exchange Commissions laws and regulations. The Reg D Series is how it’s done. I specifically recommend the Regulation D 504 due to the fact that no filings or reviews are required. It is a cost effective method to raise up to $1 million. If your requirements exceeds $1 million, then most likely a Reg D 506 will be required that has more restrictions and requirements associated with it but again, is very effective. My role is to prepare all the necessary documents and tools used in the offering. I am YOUR coach through the entire process. Most of my clients raise their funding within 90 days.

This is nontraditional funding and does not require financial’s, credit reports or other burdensome disclosure. The private investor is simple purchasing your privately held stock or a unit position in exchange for his/her money. Each investor takes a minority position in the company. You never loose
control of management or majority position in your company.

Each investor will want to know how they benefit from their investment whether through declared dividends or an established percentage of the profits from the company.

Once the Private Placement Memorandum is prepared, one of my associates who is a host for a radio investment talk show will send out a newsletter explaining your offering to 12,000 private investors.