What to expect in a private placement

February 16, 2017 - 3 minutes read

In some ways, investing in publicly traded investments are easier.  In many other ways, investing in a private investment is much easier.  We’ll explore what to expect in a private placement here.

Before we begin, it’s important to note that our description is largely a process composed by Waypoint Property Group.  And while processes and procedures may vary by sponsor, the basic components and requirements are the same.  Additionally, we’ll focus exclusively on Regulation D offerings.

What’s Mandatory in a Private Placement

Investing is risky.  It is possible to lose all of your money with any investment, and therefore, it’s important to cover your bases.  What does that mean?  It means researching and vetting any potential investment you are considering.

Because some offerings don’t have strict requirements, it becomes your responsibility to learn all you can.  Regulation D are these kinds of offerings.

Most noteworthy, Regulation D rule 506 has no requirement to produce documents for potential investors.  This means that while there is no rule, no law or any other requirement to disclose potential risks to an investor, some operators like Waypoint Property Group will.

What to expect in a private placement

We’ve just outlined the exemption to the rules around investments.  And due to those rules, or lack of rules, that Waypoint Property Group works exclusively with accredited investors.  While we believe everyone should have the choice to invest in whatever they choose, the onus is on the investor to make informed, educated and experienced decisions.  More often than not, accredited investors have the education and experience to know what to look for and what they need out of an investment.

As part of our document flow, we produce a number of items around a new investment.  The goal is to get a potential investor familiar with the facts and the circumstances around the investment.  Here is a list:

  • Offering Webinar:  Designed to be a comprehensive introduction, the webinar outlines the asset, where it sits, why it is viable and projected investor returns.
  • Offering Memorandum:  A written document that offers greater detail about the investment than the webinar.
  • Private Placement Memorandum:  The most important document in this stream of introductory material.  Written in legalese, this document highlights the risks and rewards of the investment in stark detail.

Waypoint Property Group believes in providing all potential investors with all of the material they will need to make a prudent decision around a new investment.  We leave no stone unturned because our investor’s comfort with an investment is our priority.  No matter who you choose to place your investment dollars with, collecting all pertinent information around an investment will mean greater satisfaction in the long run.

Tags: , , , , , , , ,