TGCI 44: What SEC (Securities and Exchange Commission) wants you to know as a passive investor?

Summary:

In today's show, Pancham interviews Mauricio Rauld, Founder and CEO of Premier Law Group.

As a syndication attorney, Mauricio helps syndicators understand the nitty-gritty of real estate investing. Or, as Mauricio puts it," stops them from going to jail".

You will learn the difference between a private offering and the ubiquitous IPO. Mauricio then explains the difference between 506 B and the lesser-known 506 C exemption. What are some of the reasons why most syndicators choose to operate under a 506 B exemption?

If you are a passive investor thinking of investing in a syndication, then this show will be of particular interest to you. Mauricio has some great pointers on how to conduct a due diligence so that you can protect your hard-earned money.

We hope you enjoy this show!

Timestamped Shownotes:

• 02:13 – Understanding the basics – how do private investments work?
• 03:10 – Mauricio's background information
• 04:20 – As a syndication attorney, how does Mauricio help real estate investors?
• 05:10 – Private Offering vs. IPO – Mauricio explains the difference in simple terms
• 07:08 – Mauricio shares his typical client avatar
• 09:43 – What is a Regulation D exemption?
• 12:35 – What is the difference between 506 B and 506 C exemption? What are some benefits of 506 B over 506 C exemption?
• 15:30 – Which exemption do crowd-funding platforms like Realty Mogul operate under?
• 16:28 – What are some benefits of 506 C exemption?
• 18:00 – As a passive investor, should you avoid investing alongside non-accredited investors?
• 18:43 – What is the ONE thing that you should consider in your due diligence process?
• 19:43 – What is a private placement memorandum? Should you insist that your sponsor furnish a PPM before you park your hard-earned money in a deal?
• 23:30 – As a passive investor, is your liability restricted? Can you be sued in case of any untoward instances?
• 30:21 - Taking the Lead Round
• 30:32 – When was the first time Mauricio invested outside the Wall Street?
• 31:20 – What fears did Mauricio have to overcome when he first invested outside the Wall Street?
• 32:07 – Can you share one investment that did not go as expected?
• 34:07 – What is one piece of advice you would give to someone who is investing in the Main Street?
• 31:01 – Mauricio shares his contact information

3 Key Points:

1. Private Offering vs. IPO – understanding the difference in simple terms
2. How to conduct a thorough due diligence before investing your hard-earned money
3. 506 B vs. 506 C exemption – Understanding the difference