When a private placement is the better option for raising corporate capital

Posted by Elite Internet Technologies on November 4th, 2016

If you’re looking to raise capital through a private placement, be aware – This is a tough marketplace. Documents need to be done well, and done properly. Forget “The Wolf of Wall Street” for a minute. Real businesses don’t throw money at anything without good reason.

The basics:

Private placement preparation is a formal process, covered by Regulation D 506 when you want exemption from SEC registration for your offering.

The formal process, in this case, is also the best practice process for both companies and investors. It’s a practical option for companies which can’t afford the major market SEC attorney processes.

Mistakes are not an option when raising private capital. Your private placement proposal and exemption documentation need to be rock solid.

The one thing that annoys investors more than anything else is being asked for money by people making bonehead mistakes.

The good news is that Reg D 506, done properly, is practically idiot-proof. If you have experienced people on your side to do your Regulation D memoranda, there just won’t be a problem with this critical process.

Making your proposal

The bad news is that exempt or not, if you put together a messy proposal, your credibility is effectively over. Nobody will be able to believe you’re even taking your own proposal seriously. They’ll also be asking why you’re so determined to waste their time with a proposal they can’t even look at seriously.

This is real business, not fiction or some sort of bureaucratic hobby. If you’re looking at private capital placement financing for your venture, you need top quality professional standard information which can take any level of very demanding scrutiny.

There’s a private placement agency in Denver called Venture Associates which is a virtual do-everything service for managing the nuts and bolts of private placements from exemptions to finalization. They’re a well-known private placement company, and they’ve been in business for over 30 years. There’s nothing they don’t know about private placements, in just about any industry.

Before you even begin to do a private placement proposal, see their website here at www.venturea.com and check out their information, particularly about Regulation D. They can help with everything from capital sourcing to the real minutiae of private placements. You’ll be glad you checked them out.