Private Money 101 With Securities Expert Gene Trowbridge

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I was very excited to get a chance to interview Gene Trowbridge for my blog this week.   Gene is an instructor for CCIM, worked as a commercial broker, and successful syndicator.  Gene is now focused on using that background to advise other real estate syndicators via the private placement system.

Listen to Private Money 101 today to get answers about:

  • What group investments count as a security and what to do to avoid that
  • Why notes are tricky: step carefully in this arena
  • How to legally market for private money from people you don’t know
  • How large the pool is of potential investors (5 TRILLION plus!!!)
  • The difference between an accredited investor and sophisticated investors
  • What are the steps to get started!

Watch the Video Below

Key Definitions

Syndication:  A professional financial services group formed temporarily for the purpose of handling a large transaction. Syndication allows companies to pool their resources and share risks.  (See Investopedia)

A Security:  The Howey test established that a security is

  1. investment of money due to
  2. an expectation of profits arising from
  3. a common enterprise
  4. which depends solely on the efforts of a promoter or third party

Intrastate Offering Exemption:   If the property, the sponsor, and the investors all reside in the same state a sponsor can claim an an exemption to Federal Registration even if the government is not shutdown.

Private Placement:   A process that permits a sponsor to opt out of the expensive ($250k) process that companies that offer IPO’s must under take.

Rule 506:   The private placement exemption that permits a sponsor to raise an unlimited amount of money from accredited investors and up to 35 sophisticated investors

Accredited Investor:  Refers generally to a person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person or a person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year

Sophisticated Investor:  A type of investor who is deemed to have sufficient investing experience and knowledge to weigh the risks and merits of an investment opportunity.

Next Week

Tune in next week for Private Money 201: the JOBS act and You were will will discuss:

  • How marketing has changed or won’t under Rule 506
  • What is crowd-funding?
  • Will crowd-funding really help real estate investors?
  • How to turbo charge your syndication business with broker-dealers


Related Posts:

Marketing for Private Money Through Syndication: Stay Legal My Friends
The Definitive Guide to Legally Pooling Money for Real Estate Investments: Tips, Tricks and Traps.
How to Tap into the Private Money Gold Mine

“Its a Whole New Business”  by Gene Trowbridge

About Author

Douglas Dowell

Douglas Dowell J.D. is a commercial and multifamily investor. His blog will focus on legally raising private money, risk mitigation with due diligence and management science. He is also an avid student of success principles with a focus on modeling success factors.


  1. Great interview Doug! I’m looking forward to next week’s portion. I do have a question, Gene said that someone is raising a $400,000 syndication. With fees ranging from $25.000 to $50,000, how can the syndication be profitable when expenses are so high from the start?

    • Douglas Dowell

      Thank you Johnson,

      I am just speculating but I would guess the deal is very juicy and or the deal fee’s and 3rd party cost are on the lower end since it is a small deal. Otherwise, your right why do it if its not marketable and the sponsor dose not clear enough to compensate for the time and personal risk?

      • I agree. The reason why I ask is that I do want to syndicate someday and a few people have asked me to, but I am no where near raising a million dollars but if someone can raise $400k and still be profitable for everyone with $25k-50k in initial fees, I may have to look into it more closely.

  2. I wish you did and put it all up on Youtube! Would love to hear more on how to get started and all the steps. But I guess that is where is $295 book and $$$$ workshops come in.

  3. Douglas Dowell

    Those options are out there. I would hit up Brian Burke of Bryan Hancock here on BP. They have been in that arena and have great info.

    I think finding a local syndication guy maybe at an apartment association. Would be good to It seems its a small crowd that even know about this model.

  4. One of the best articles ever here on BP! Gene is a rock star and you did a great job with the interview!

    I know a lot of effort and work went in to putting this together.

    • Douglas Dowell

      Thanks for the comment Shaun,

      I agree its a VERY broad area and like the tax code, securities law is a foreign language. I think youtube is a great fit for this interview in that it allows you to watch as many times as you want or can stand to hear me say “outstanding” haha,

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