Helpful Information About Private Placement Broker-Dealers

Private placements come in many shapes, sizes, and regulatory designations. These include Regulation D, Rule 506(c) of Regulation D, and Regulation S among others.

Rule 506(c) allows companies and broker-dealers to utilize "general solicitation," which means that they can market freely to attract accredited investors with whom they have no prior relationship. This also allows for a tremendous net to be cast which has a dual effect: to attract investors to a particular deal and to bring more clients to the broker-dealer for standard investing.

The Private Placement Issue

Currently, the world of broker-dealers is diminishing. There are only around 4,000 broker-dealers left, of which only around half, not including the big companies, transact private placements or alternative investments.

The broker-dealer that companies seek is a firm that has hundreds of brokers and billions of dollars under management, which can be deployed for their deal. This is typically very hard to find. Broker-dealers and their brokers are not bound to sell any particular product and as such, it is difficult to find a broker-dealer to work with. This is why it is best to find an expert to guide you.

Different companies aim to address this problem through a variety of solutions. Some even consider combining their available options. These include the following:

  • Buy a Broker-Dealer
  • Build a Broker-Dealer
  • Partner With a Broker-Dealer
  • Private Equity Funds
  • Family Offices
  • Develop a Website to Attract Investors
  • Hire a Marketing Firm
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Things to Remember

When looking for a proper partner or acquisition, companies must decide what business they want to invest in. Do they want to succeed in a familiar space or take a risk with a new venture?

The key to any business development plan is to decide which direction to take and the amount of time, effort, and deployment of resources your company is willing to make in the process. Additionally, it is vital to have patience in getting to the end zone successfully.

Reach Out to Us

Feel free to get in touch with Ken Norensberg today for additional information about private placements, broker-dealer services, or business development. Our team will also be more than happy to answer any question you may have.