An Accredited Investor List Can Help You to Raise Money
If you are raising capital, an accredited investor list can help you to reach more investors that are qualified and able to put money into your deal. When raising money using a Reg D offering, it is important to work with accredited investors to stay in compliance with the SEC. The challenge is that there is no way to tell if someone meets the qualification standards when you meet them. A list will help to save you time by sending you directly to the people that meet the SEC standards.
The SEC has set criteria for what makes a person an accredited investor. This includes:
Income. The investor needs to make $200,000 a year by themselves for the past two years or $300,000 per year with their spouse. They must also believe that their income will continue at that level or greater.
Assets. An investor may qualify if their net worth is over $1 million, excluding their primary residence. In order to calculate net worth, review their assets and liabilities. Once their debts, minus their first mortgage, have been deducted from their total assets you get their net worth.
Even when people have good jobs and a big house, they may fall short of the SEC’s standards for what makes an accredited investor. This is why purchasing an accredited investor list can save you a lot of time. You won’t have to wonder or guess if someone meets the criteria. All you need to do is pick up the phone and start calling.
The accredited investor list can be broken down by several areas including demographics, geographic location, and even industry niche. For example, you can purchase oil and gas leads to raise money for a private placement in that industry. The more you narrow down your lead list; the better your chances of success are. This means you will spend less time on research and trying to make connections and more time actually pitching your deal.
You can purchase an accredited investor list from either www.salesleads.tv or www.accreditedinvestorleads.com. When speaking with a representative let them know if you are looking for leads in a certain geographic area or any other qualifiers you need.
Before you call, make sure that your private placement is ready to go. It should be prepared in compliance with Regulation D and include an executive summary, financial information, a business plan, market analysis, competitive analysis, information on leaders and a term sheet. Be sure also to include disclosures and risk factors. It is impossible for every deal to go exactly as planned and market conditions can change with the wind so leaving out risk factors is unwise. When making calls, your pitch should be a summarized version of what is in your private placement. Give enough information for them to want to learn more, but not too much to bore them or give an information overload. Keep track of everyone you speak with and who gets copies of your private placement. Follow up with your accredited investor list and start to raise capital.