All Forum Posts by: Jillian Sidoti

I am a securities attorney. I see a lot of deals and I watch a lot of people make a lot of money by doing direct investment. I also worked in commercial real estate and am a CCIM.

With all this being said, I have realized something very clear about me personally: I am a much better passive, syndication investor than a direct investor. I tend to get overly emotional about direct investments, don't take care of things that need to be taken care of, and nitpick and worry about the unimportant. Yes, there is potential to make more money, but the stress is too much for me.

I still own some single families and a duplex directly, but once I get rid of those I am going to most likely stick to my current model of investing with other people that have a dedicated, full time team to direct investments.

Hi @Todd G. - (thanks again, @Jessica Zolotorofe)

I suggest checking out sites like Crowdstreet and RealtyShares. These are sites with props that are leveraged with traditional financing and then the crowdfunding is the down payment. Good luck!

Hi - I have made money on GF and I have lost money on GF. So please, check the deals out carefully. They are much higher risk than some of the stuff on Crowdstreet, Fundrise, or Realty Mogul.

@Joe Rinderknecht - may I ask how much money you are looking to raise? From how many investors? In which state?

If you are staying in one state, raising a low amount of capital, and/or are securing the investment, you MAY be able to use a self-executing exemption in a particular state (note: most states are awful and have no such exemptions.)

What Sherman Ragland said is correct and good advice. Let me know if you are looking for further advice. I might be able to lead you toward a state law that will save you money. Also, contact Amy Wan (she is on BP - I can't seem to tag her). She has an inexpensive legal solution for those raising smaller amounts of capital.

If you are raising more than $500,000. I STRONGLY recommend you contact a securities attorney. Take no chances. I am happy to consult with you if you would like.

no problem, Zack. Don't hesitate to reach out if you need anything.

@Chris Grenzig and @Jared Carpenter - the fourth way is verification of accreditation through 2 years of tax returns. No one does this method.

Another way is enlisting the services of a third party verification service like Verify Investor or EarlyIQ.

There is a lot of information here. I hope I can add some clarity. There is a test to determine if you are selling a security:

1. There is an investment of money.

2. In a common enterprise (there is more than one investor - not in the project, per se, but in YOU.)

3. The investor expects to profit off of their investment.

4. The efforts of making the investment opportunity work are in YOU. (In other words, you are doing all the work and the investor is passive).

If you say "yes" to all of these, you are selling a security.

The definition of "mortgage" is "asset backed security."

WHAT DOES THIS MEAN???

The references to the laws above are a very good start, but let's try to simplify. Your obligation (the most important obligation) is something I call the "three D's": Disclose, Disclaim, and Details

1. Disclose all the risks associated with investing in your deal.

2. Disclaim any liabilities.

3. Provide all the details an investor would need to know in order to make an informed investment decision.

If you are thinking of taking money from investors you should reach out to a securities attorney to assist you. You are always welcome to connect with me with your questions.

I hope this helps! Good luck!

Zack, crowdfunding is awesome, but it isn't a magic bullet. 

1. You have to find the right cf platform for your deal. A platform that did a successful raise for one deal won't necessarily be right for yours. 2. You have to make sure a platform will take you. Cf platforms have their own underwriting requirements and many of them are quite choosy. 3. You can't totally rely on the platform for marketing. You have to bring your own crowd to the deal to ensure success. I hope this was helpful. 

I am pretty sure Gene Trowbridge is going. 

are you selling or raising money?