Tilden Moschetti: There is a reason why 4.6 times more
private exempt securities offerings are put under
Regulation D than Regulation CF. Let's go through what those
differences are so that you can make your own decision on what's
best for your security offering when you're choosing an
exemption between Regulation D and Regulation CF.
So when the big showdown is between Regulation D and
Regulation CF, the two major opponents, when it comes to
exemptions from registration under the Securities Act, now I
there is another opponent out there and we'll Asterix like
here, Regulation A does exist. Regulation A though is a little
bit different, because you still make a filing, and it's reviewed
and approved by the SEC. So it's not like a true like file a Form
and you're automatically exempt. So it's a different kind of
opponent. But two big opponents are Regulation D and regulation
CF. Now, let's talk about the stats and the differences. In
one corner, we've got Regulation D, the heavyweight champion of
the world, with 4.6 times more knockouts than Regulation CF.
Why 4.6? Well, first, you've got Regulation D breaks up into two
different rules. And one of one of those rules is the rule that
you'll pick, if you go with Regulation D, in one corner,
you've err in one hand, you've got rule 506b 506. B is great.
It's also concert called friends and family because you can take
non accredited investors up to 35. And then a 90 day period,
and an unlimited number of accredited investors, you can
also raise an unlimited amount of money, you're not stopped at
5 million, 1 million, anything, you can raise $1 trillion. If
you can, if you can give me a call, definitely we need to
partner up because $1 trillion is a lot of money. And if you
can raise that much, well, I want you on my team. But that
aside, Regulation D rule 506b, so the other fist is a great
regulation, we can raise an unlimited amount of money from
an unlimited amount of accredited investors and the
knockout punch for it, you can advertise so you can put a
billboard on Main Street, you can plaster the internet with
ads, just to get your name out there and get your investment
out there. The big trouble with 506c, the one where it gets hit
and they've got that rule is because we can't take any non
accredited investors. In fact, we actually have to make sure
that each one is accredited by having third party verification.
But having the ability to raise an unlimited amount of money
getting to choose between whether we have non accredited
or an accredited investor is a pretty major win for it doesn't
it sound like 4.6 times more knockouts. But that's not to say
that there's not a lot to be said for the other opponent,
Regulation CF. Now, regulation CF doesn't break out into
different rules like that it just as one rule. So regulation
CF lets you raise money from both accredited and non
accredited investors. It lets you advertise. Now, what's the
problem with Regulation CF? Why isn't it getting more than
Regulation D? Two reasons. Number one, it's got a cap of $5
million $5 million in any 12 month period, kind of a
negative. The other big problem with Regulation CF. And to me,
this is the biggest problem, you still have to do a filing this
time it's on a form C versus a Regulation D is on a form D your
stuff to do that filing. But you've got to have all of your
marketing and all of your transaction go through a
registered portal. Ah, what is a registered portal, a registered
portal is a third party who puts your name and puts your
investment out there and take some of your profit. How much of
your profit I've heard as much as 10 to 12%, which is a huge,
huge chunk. Now maybe there are some that are less that take
charge less. But you have to ask yourself if you're not able to
actually put it out there yourself. You're still You're
gonna be responsible for marketing it to drive all your
traffic to this third party portal, that's not even you, you
don't even get to control that traffic. So you have to be
driving your own traffic to this third party portal, where they
also have all of your competitors investments as well.
And they charge you 10 to 12% for the privilege, and the
preparation of all the documents needed for Form C and to comply
with REG CF cost just as much as that in Regulation D. That's why
when it comes to the ultimate battle, to me, I think the clear
winner has always been Regulation D and the stats show
it 4.6 times more, a lot of people come to me after trying
to do a Regulation CF, it just didn't work out, it was
expensive. And a complete flop Regulation D, we can craft a
marketing plan with you to make sure that your regular offering
is successful. And the the cap on the lit number of accredited
investor or non accredited investors isn't that much. If
you've got the right network, if you don't have the right
network, then you only can mark it to your right your accredited
investors. But if you've got the rights pitch, and you've got the
right story, your Regulation D offering is gonna be successful.
So now it's time for you to make your own decision on what works
best for what you're offering. To me. It's always Regulation D.
So if you give me a call, wanting to talk about what the
two differences are, I'm always gonna say Regulation D, I'm
happy to have a conversation comparing and contrasting the
two, but just know I'm always going to be on the side of
Regulation D, it's the heavyweight champ and you don't
go against the champ. But I'm always happy to have that
Regulation CF is a fine choice. I may be in favor of Regulation
D but it's still a very, very good choice. Regulation CF
though has those negatives. And then a plan can be worked out
around those in order to solve it through Regulation D. Or if
Regulation CF is the right choice for you. That's great
too. Now if we can help you either make that choice or if
you need help with your Regulation D offering, give us a
call and let's see if I can help you