All Forum Posts by: Amy Wan

It seems to be like you're going through a lot of work to try and get past accredited investor rules. In all likelihood, YOU probably wont get caught, but if you are, the one who would be liable would be your dad. Oftentimes PPMs have clauses in which an investor attests that they are buying for themselves and not with a view to sell to anyone else.

But like other commenters here said, some 99% of the all private capital raised in the U.S. is raised under 506(b) and its the sponsor's discretion whether they want to accept non-accrediteds into those deals. There's no reason you should have to bend over backwards to pigeonhole into a 506(c).

There are a number of ways to pay back investors--but it depends on your business plan, the deal, and what you're investors are looking for (short v. LT opportunity). Some refi out, some flip or do some quick value add, some do buy/hold, some increase the value and occupancy over a number of years. Everyone's got a different business strategy

@Stephanie Martinson A note can actually be a security as well. The analysis here is how many passive investors you have. A note with one investor likely isn't a security. You can do an equity or debt deal with the investor--that's a business decision.

SEC guidance is there, albeit not fully fleshed out. People are doing it. But the tech isnt ready, custody isnt ready really, secondary markets arent ready, and i think this all needs to come from institutional down.

Right now, the technology is not yet suitable for small projects, simply because the transactional costs are way too high and there's no secondary market. We are still many years out from this being appropriate for small deals.

There is... just a lot to unpack in this thread. It doesnt sound like a GP/LP structure to me, for one. Real estate attorneys generally handle purchase/closing transactions but you want a securities attorney also for the syndication aspect of what you're trying to do. I'm not sure why you're looking at note agreements. And... syndications oftentimes don't even use a term sheet. I do ppms/docs for smaller deals and start at 7500, but am a national provider. 

Happy to chat with you. There's just... a lot of confusion here I think.

Hi Stephanie,

That deal is likely too small to syndicate. You should just go take one check from one person (not more than one person), and call it a day. Otherwise, if you truly do need multiple checks, you should bundle a number of SFRs into one syndication offering. Otherwise, the transactional cost of legal docs alone (starting at 7.5K) will not be worth it. All your profits will be going to the lawyer, not you and the investor. (I mean, I'd take it, but I'd strongly advise against it).

most of the sites that work with accredited investors take SDIRA money. As for a list of sites, @Ian Ippolito has compiled a whole list and ranking of them

@Dhruv Anand you would need to form your own fund or “sub-syndication”, which does require going through the usual legal process. There needs to be enough meat on the bones of the deal to make sure there’s enough to go around.

It doesn’t really work the way you’re describing. You set a minimum investment amount and people invest however much they choose.

And yes, you still need to talk to a securities attorney if you’re using a GP/LP structure.