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Hi everyone,

This is my first post on startupnation, and I'm glad to have found this site.

My question is: Does anyone have any good templates for a private placement memorandum.  As a start-up, I don't have the $10K it can take to have one written.  I know, because I've been with a company before that paid that ludicrous amount for a document that came from a template that had bad grammar.  And this from one of the top law firms in Oklahoma City!

Thank you for your attention and any information you may be able to offer.

Respectfully,

Shawn Garza

Shawn,

I'm saddened to hear about the company that paid for a PPM that was from a template and full of errors.

However, I don't believe a 'template" is the solution. While one may need such a document to comply with the regulations - it's not (or shouldn't be) just boilerplate.

Determining what should (and should not) be in the document is highly important.

The first key to a successful capital acquisition is selecting the optimum capital strategy -part of which is "your deal" or what you intend to offer in return for the capital.

If you would like to discuss your situation in confidence, feel free to drop me a PM or contact me directly.

I have used Privateplacementmemo.com and they are very knowledgeable, give you an attorney review, and do it all for $2500 flat.

You might try www.legalppm.com.  We offer Private Placement Memorandums and the services to put them together as well.

At a price as low as $139, we guarantee that you will be satisfied with it.

Shawn, As I’m sure most people with a background in corporate finance would agree, the use of sample private placement memoranda can serve a valuable purpose. If used as a reference, rather than a boilerplate template, these documents can offer insights into the specifics of actual offerings and thus, provide small issuers with valuable information on how a successful equity or debt offering is constructed.

The problem inherent to working on private placements is that it typically requires legal expertise in the application of federal and state securities laws, and an intimate understanding of capital markets, which is something very unlikely to be combined in the background of a single professional.

Although the smart use of sample private placement memoranda can help you narrow that knowledge gap, they should be used with caution as every issuer has different requirements, focus and expectations.

Please don’t purchase them based on price and the assurance that you will be satisfied. Look at their pedigree and try to get as much information and feedback on the author as possible as I’ve seen some rather obscure sites offering these documents.

In the event, you’re still unclear on how to proceed with your private placement, please feel free to review our article “Private Placements – What is Myth? What is Reality? The article is available at http://publications.fastventures.com/article/private-placements-or-regulation-d-offerings---what-is-myth-what-is-reality

If you’re interested in some quality sample private placement memoranda, please take a look at: http://publications.fastventures.com/reference-documents

In the event you’re interested in jumpstarting communications with potential investors in your private placement, please take a look at our whitepaper “Reaching High-Net-Worth-Individuals with your Private Placement”, which is available at http://publications.fastventures.com/reaching-high-net-worth-individuals-with-your-private-placement

This whitepaper reflects the investor communication strategy we used while raising about $5 million in a Series A equity round for a distressed real estate investment fund.

In the event your needs are a little more complex, please feel free to visit our website at http://www.jacksonsteiner.com/en/expertise/fa/private-placement-advisory.php to learn more about our private placement advisory services.

Please feel free to send me a private message here on SUN or contact me via JacksonSteiner.com if you would like to discuss your project in greater detail. I frequently work with other financial services firms, so maybe I can give you a few additional pointers.

I hope this helps.

Cheers & good luck in your endeavors.

Karl Mohr

Protect yourself now and in the future - to ensure no problems with investors or the SEC - hire an attorney with direct knowledge.  A little extra expense now will save you many times more in the future.  There are many things in business you can skimp on - this is not one.

BMT2010, I think you're missing the point that most small issuers simply don't have the $10,000-$50,000 most law firms charge for a custom private placement memorandum.

Besides charging upwards of $250/hour for their work, their fee likely includes fees of financial services firms for completing the actual offering and other financial elements of the private placement memorandum.

I'm not telling to skimp, but you may be able to save quite a bit of money if you jumpstart your offering by using a quality reference document and work with a reputable financial services firm to construct the actual offering.

As the last step, you should have your private placement memorandum reviewed by a qualified attorney before putting it into circulation to make sure it complies with all federal and state securities laws. There's no point skimping on that.

I'd like to thank everyone for your thoughtful and informative replies.

I should have been more specific.  I am fully aware that a PPM should not be simply a boilerplate.  I truly meant that I need one for a reference.  Thanks to pointing me in the right direction.

Follow up question:  Are there any small brokerage or corporate finance firms who will market a PPM for a fee?  I haven't been able to find any in my research.  I get the feeling that this market is not as lucrative for these firms as other business may be.

Thank you again.

Shawn Garza

Shawn,

Except for those covered by the "issuer exemption" anyone else involved in the offer or sale of a security MUST be a licensed broker-dealer (what you called a small brokerage). 

Before a broker-dealer decides to "market" a Private Placement, they are required by FINRA and the SEC to perform due diligence on the offering, the company and it's principals. This can be time consuming and expensive.  Furthermore, before "presenting" the security to a prospective buyer, the broker must ensure that the buyer meets the NASD suitability requirements. Lastly, they may face claims from their clients (buyers) for their losses.

All of that plus the record-keeping requirements results in reputable broker dealers taking a pass on almost all PPM's - especially those of a start up.

If you want to discuss your situation in more detail, feel free to drop me a PM or contact me directly.

Shawn, I’m not sure if you’re still interested in developing a private placement memorandum for your fund, but one of the companies I’m working with has launched a brand-new service that is aimed at issuers who can’t afford to hire a professional financial advisor or financial services firm to get this done.

They’re calling the service “Live Advisor”, which offers three different service options depending on the level of assistance you need while working on your private placement memorandum. Since you will be doing some of the legwork, their fees are very affordable.

For instance, they charge $99/month to have weekly sit-downs with a dedicated financial advisor who will answer questions, resolve issues, and provide general guidance on how to develop a quality private placement memorandum. Check it out at:

http://publications.fastventures.com/service/live-advisor-one-on-one-private-placement-memorandum

The other, more comprehensive service option includes immediate access to a senior expert advisor whenever you need help with completing your private placement memorandum. This service starts at $695/month. Check it out at:

http://publications.fastventures.com/service/live-advisor-professional-private-placement-memorandum

Cheers!

Karl