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So far bsmith@carofin.com has created 96 blog entries.

8,000+ locations and $6.1 Trillion Dollars in tax savings

If you’re an accredited investor, you’ve probably heard about Qualified Opportunity Zones (“QOZ”). Here’s a short guide to outline the what’s, why’s and who might consider this investment strategy. What opportunities and challenges do QOZs address? Opportunity zones were created to spur economic development in distressed communities across the nation by the Tax Cuts and More >

8,000+ locations and $6.1 Trillion Dollars in tax savings2020-12-08T16:48:47-05:00

What would you do for 20% more?

By Henry Yoshida | CEO of Rocket Dollar The Power Of Tax Deferral In A Self-Directed Account When we’re talking about your tip on a lunch out, 20% hardly seems worth discussing (especially if the service is good). When we’re talking about your retirement accounts, 20% could mean hundreds of thousands (even millions) of dollars More >

What would you do for 20% more?2020-12-08T16:50:31-05:00

Debt & Equity Investment Overview

When we talk about private securities, they can be split into two basic categories: Debt & Equity. While there are many many, different flavors of each, every savvy investor needs to have a solid grasp on what makes one more appropriate than the other—especially before purchasing.  We put together a slightly exhaustive overview of both More >

Debt & Equity Investment Overview2020-12-08T16:52:13-05:00

Primary Investment Considerations (or First Principles)

Investment analysis can be highly challenging. Each Issuer of securities (the company seeking your investment) differs in significant ways from others, and it’s easy to miss “the forest” for a few particularly compelling “trees.” Therefore, it is essential that you apply a consistent approach to your analysis that first identifies the fundamental rationale for an More >

Primary Investment Considerations (or First Principles)2019-05-01T16:54:48-04:00

Seven Questions for Evaluating a Private Company

After evaluating thousands of unique private companies and alternative investments over the past 20 years, we have created this list of fundamental investment considerations for our use, and we are happy to make it available to you.     If you want to dive further into the Seven Questions framework, our complimentary white More >

Seven Questions for Evaluating a Private Company2019-05-06T19:13:00-04:00

Articles of Innovation: Sustainability 101 

By Gillie Roberts | Ware Don’t let the bureaucrats fool you: It is less about what a business is doing and more about how they’re doing it.   For such a long word, “sustainable” seems to have found its way onto websites and advertisements by everyone from the service industry, to tech, to beauty products—reminding us all that no one pays by the letter for marketing materials anymore. More >

Articles of Innovation: Sustainability 101 2020-12-08T16:59:39-05:00

Taking your retirement by the reins: What is a Self-Directed IRA?

By James Jones | CEO of IRAeXchange.net  I’ve spent a lot of time in and around IRAs and Self-Directed IRA or “SDIRA,” writing books, speeches, and, generally, educating folks on the topic.   Inevitably, when people get a chance to engage with me after a panel discussion or other presentation, they ask questions.  Shockingly, they are often CEOs, Fund Managers, and other financial professionals asking questions about a tax-deferred vehicle that, recently, is growing in popularity by leaps More >

Taking your retirement by the reins: What is a Self-Directed IRA?2020-12-08T17:01:12-05:00

Wealthy in the Hamptons Set Their Sights on Private Investments

In a recent article in Bloomberg, Simone Foxman discusses the rising trend among the centimillionaires investing directly in private enterprises and away from managed products.  While I agree with the author, let me expand on a few points.  You Don’t Have to be a Centimillionaire to Play in This Market. First of all, it’s not just the centimillionaires who More >

Wealthy in the Hamptons Set Their Sights on Private Investments2020-12-08T17:05:02-05:00

Blue Sky Laws: History and Application to Private Investments

If you’re thinking of Willie Nelson crooning “Blue Skies,” you’d be in the right state of mind.  That’s because each state has its own state Securities laws, or “Blue Sky” laws, that further protect Investors from Securities fraud.   Here’s a brief overview of what those laws do for you.  More >

Blue Sky Laws: History and Application to Private Investments2020-12-08T17:09:03-05:00

Deciphering the Signal out of a Noisy [but Mature] Residential Solar Market

Recent solar industry headlines (see the latest from Forbes) would suggest that international trade negotiations (or perhaps more precisely, disputes or wars) are among the most important things to know about solar. Opinions vary on the efficacy of such international policy, but suffice it to say that this escalating trade kerfuffle is masking the growing strength of the More >

Deciphering the Signal out of a Noisy [but Mature] Residential Solar Market2020-12-09T09:14:35-05:00

Oil and Gas Forecast

In this article we ask and answer: “Should a private investor look closely at oil and gas exploration and development opportunities now? What do the pundits think?” More >

Oil and Gas Forecast2020-12-09T09:47:36-05:00

Angel and Venture Alert: The Case for Investing in Orphan Drugs

No, we’re not talking about developing drugs for orphans. But for 25 million Americans, according to the NIH, an “Orphan Drug” (one that serves fewer than 200k users and includes diseases such as cystic fibrosis, Lou Gehrig’s disease, and Tourette’s syndrome, among others) can spell the difference between misery (or worse) and getting through the More >

Angel and Venture Alert: The Case for Investing in Orphan Drugs2020-12-09T11:04:08-05:00

Why Pay Attention to Blue Gem Coal?

Okay, I know. Most people think of “dirty” coal or the Coal Miner’s Daughter. Understandably so, if those types of coal constitute greater than 95% of all the world’s known coal reserves. Did you know that Blue Gem Coal (and some valuable minerals derived from it) is used to make clean solar panels, cell phones, More >

Why Pay Attention to Blue Gem Coal?2020-12-09T14:32:18-05:00

The U.S. Solar market is going mainstream.

It might be surprising to many investors to learn how large and how quickly the solar power market is growing.  In 2017, 30% of all new U.S. electric generating capacity came from solar, ranking 2nd only to natural gas.SEIA-GTM (2018). U.S. Solar Market Insight In 2010, only 4% came from solar. And what may be even more surprising is that More >

The U.S. Solar market is going mainstream.2019-02-01T17:00:27-05:00

Private Equity Term Sheet: Typical Terms and Conditions

You’re considering an equity investment in a private company with exciting prospects…  Great, but do you really know what your “equity” investment in the company will get you?  Investment characteristics of one type of private equity investment can be very, very different from another.  This guide can help you understand better what’s being offered to you. There More >

Private Equity Term Sheet: Typical Terms and Conditions2021-02-02T10:38:40-05:00

What is a Balance Sheet?

Accounting 101 – Not your best subject.   But, if you intend to invest in a private company, spend a few minutes on these crib notes. They may save you a bundle down the road.  More >

What is a Balance Sheet?2020-12-09T14:47:40-05:00

Why Do Companies Use Debt Financing?

The following outlines the major reasons why businesses may choose to use debt financing over issuing equity when capital is needed. Businesses and other entities can finance their enterprises by issuing equity or using debt, such as borrowing funds through loans or by issuing notes.  Unlike equity, debt has a specified interest rate and a schedule of dates when interest is to be paid and all the principal fully repaid.    Many fast-growing companies would prefer to use More >

Why Do Companies Use Debt Financing?2021-01-15T14:21:14-05:00

Private Placement Memorandum and Other Private Investment Documents

You’ve decided to invest in a short-term private debt Security. Or, perhaps, a private equity investment. Great! Now what? Let’s review what you can expect in the way of Closing Documents, such as the Private Placement Memorandum. Closing Documents include agreements between the Issuer and the Investor in which the parties commit to participate in the offering and state the specific terms of the investment relationship.  The More >

Private Placement Memorandum and Other Private Investment Documents2021-01-17T17:58:58-05:00

So, I’m Eligible. What Should I Know Before Investing in Private Market Investments?

Your brother-in-law tells you this Company is going to revolutionize the (…pick an industry). And these people are incredibly experienced in this field.  “Let’s invest together,” he tells you. Well … let’s take a deep breath and think about private investing and what it might mean for you. More >

So, I’m Eligible. What Should I Know Before Investing in Private Market Investments?2020-12-18T14:20:04-05:00

Why Invest in Alternative Investments? Here are 3 Reasons.

Been watching the stock market recently?  Does it make you feel warm and fuzzy, or, like many investors, do you feel a bit uncertain and powerless? If so, join other Investors seeking higher returns, lower volatility, less correlation, and greater flexibility across their portfolios by investing some of their wealth in “Alternative Investments.” More >

Why Invest in Alternative Investments? Here are 3 Reasons.2020-12-18T14:18:21-05:00

Private Lending to Operating Companies

You don’t need to be a genius to understand what happens when you lend money to a private company, but there are important things you need to know. Let’s take the mystique out of private loans! More >

Private Lending to Operating Companies2020-12-18T14:16:00-05:00

What are “Alternative Investments?”

Everybody’s talking about alternative investments, but there seems to be a lot of confusion about what they are. Well, here’s our stab at defining alternative investments — what they are and what they’re not. If you’re interested in learning about the alternative investments, this is a good place to start. More >

What are “Alternative Investments?”2020-12-18T14:13:24-05:00

“Due Diligence” and Investments: What Do I Really Need to Know?

It’s hard enough keeping this baby in running condition. But, to get the best performance, you work with your mechanic closely, asking additional questions, avoiding risks where you can.  While you rely on your mechanic, it just makes sense for you to have a deeper understanding… The same should be true of your investments.  Here More >

“Due Diligence” and Investments: What Do I Really Need to Know?2020-12-18T14:10:12-05:00

Are Alternative Investments Right for You? Answer These Four Questions First.

We’ve made the point more than once in these articles: investing in an alternative investment, and particularly in a private Company, is a high-risk gambit.    Where there may be rewards, there are most certainly risks.  So, do your homework and think about the following four questions carefully.  It’s crucial that Investors in alternative investments carefully evaluate whether the opportunity is suitable. More >

Are Alternative Investments Right for You? Answer These Four Questions First.2021-02-03T17:30:22-05:00

What Securities Laws and Regulations Govern Private Placements?

The Federal government, and its regulatory agencies, are hard at work protecting investors.  Here’s a handy précis of the rules and regulations that Issuers follow when introducing Private Placements. There is a broad body of law and regulations governing public Securities.  What surprises many is the extent of the same for private Securities. More >

What Securities Laws and Regulations Govern Private Placements?2020-12-18T13:43:33-05:00

What is a Broker-Dealer?

If a Broker-Dealer offers you Private Placement investment opportunities, wouldn’t you like to know that there’s some regulatory oversight over it? More >

What is a Broker-Dealer?2020-12-18T13:38:45-05:00

Regulation D, Rule 506(b) Private Placements

The following provides a brief review of the SEC Rules defining the manner of offering private Securities to Accredited Investors Regulation D was established by the SEC in the 1980’s to define, more specifically, a manner of privately offering Securities.  Most companies issuing private Securities do so by following one of the Rules within Regulation D.  More >

Regulation D, Rule 506(b) Private Placements2020-12-18T13:27:04-05:00

Regulation D, Rule 506(c) Private Placements

The information below provides a brief summary of SEC Rule 506(c) which allowed, for the first time, “general solicitations” of Private Placements to Accredited Investors. Regulation D was established by the SEC in the 1980’s to define more specifically a manner of privately offering Securities.  Most companies issuing private Securities do so by following one of More >

Regulation D, Rule 506(c) Private Placements2020-12-18T11:02:56-05:00

Perspectives on Private Investments & Crowdfunding

The following briefly reviews the history of securities exchanges, the establishment of the first U.S. federal securities law, touches on the regulatory burden that is currently imposed on Broker-Dealers, and references the exciting outgrowth of recent legislation authorizing Crowdfunding. While privately placed Securities represent, arguably, the oldest and least efficient form of investment banking, this More >

Perspectives on Private Investments & Crowdfunding2020-12-18T10:43:10-05:00

Accredited Investor Questionnaire

The following form is one of the Private Placement Closing Documents to be executed by an Investor.  It certifies that the Investor is Accredited. REGULATION D “ACCREDITED INVESTOR” INVESTOR QUESTIONNAIRE Regulation D Qualification Statement An investor represents to an issuer of securities that they undersigned qualify as an “accredited investor” pursuant to Regulation More >

Accredited Investor Questionnaire2020-12-18T10:59:27-05:00

Closing Documentation for Private Placement Investment Opportunities

The following describes the Closing Documents one is likely to receive from the Issuer of a Private Placement. Closing documents include agreements between the Issuer and the Investor wherein the parties commit to participate in the Offering and the specific terms of the investment relationship.  These documents are executed by the Investor and/or by the More >

Closing Documentation for Private Placement Investment Opportunities2020-12-18T10:54:56-05:00

Crowdfunding Overview

Recognizing that access to capital is critical to the health of smaller companies which generate about 50% of U.S. job growth, the Congress passed the Jumpstart Our Business Startups (JOBS) Act in 2012, which set the stage for the development of equity Crowdfunding in the U.S. The JOBS Act The JOBS Act includes several provisions More >

Crowdfunding Overview2020-12-18T10:52:21-05:00

Due Diligence for Private Business Investment Opportunities

The following outlines the importance placed upon careful, independent Investor analysis of private market investments. “Due diligence” is a process whereby Investors evaluating a potential investment conduct independent analysis and verification of the information presented to them by the Issuer. Due diligence analysis goes beyond simply reading the Offering documents, such as a Private Placement More >

Due Diligence for Private Business Investment Opportunities2020-12-18T10:44:27-05:00

Private Placement Investment Considerations

The following provides general background on, and underscores certain risks to Investors associated with, Private Placements. Private Offerings can be purchased directly from the Issuer of the Security during the Offering period or through an agented, “best efforts” process managed by a FINRA-registered Broker-Dealer acting as a Placement Agent.  Under U.S. law, other than the More >

Private Placement Investment Considerations2020-12-18T11:01:39-05:00

Alternative Investment Categories

Below is a listing of the various categories of private Alternative Investments which comprise Carofin Offerings: For more detail regarding either debt or equity Offerings, please read “Private Placements: Debt Investment Overview,” or “Equity Investment Basics.”  

Alternative Investment Categories2020-12-18T10:39:30-05:00

What is a Private Placement?

The following reviews the principal regulations which governs Private Placement offerings of securities and describes allowable investor participants. Private Placements are Offerings of Securities wherein the transaction and the related securities do not follow the public registration requirements of the Securities Exchange Commission (“SEC”).  They are traditionally offered in a non-public manner (i.e., without public More >

What is a Private Placement?2020-12-18T10:37:37-05:00

Equity Investment Basics

The information below provides a brief overview of Equity Securities. Companies raise capital in the form of either equity or debt. Equity represents an ownership interest in a for-profit company where the Net Equity Value of the company (i.e., total assets less indebtedness) and any ongoing profits are owned proportionately by the holders of the More >

Equity Investment Basics2020-12-18T10:36:35-05:00

Debt Investment Overview

The information below provides an overview of debt-related investment, in particular Private Placement Offerings. Debt financing is raised by companies through the issuance of Securities called Promissory Notes, Senior Notes, Senior Secured Notes or Subordinated Notes.  These terms indicated the underlying credit structure of a given debt Security and are described below. The amount of More >

Debt Investment Overview2021-01-15T09:12:01-05:00

Risk vs. Return Considerations for Alternative Investments

This information summarizes important risk-related considerations for Investors making Alternative Investments. Evaluating a potential investment is, arguably, the most important aspect of any investing activity, whether as part of a private Securities Offering or for a publicly registered investment. No investment is riskless, and losses will inevitably happen within a portfolio. Limiting losses and achieving More >

Risk vs. Return Considerations for Alternative Investments2020-12-18T10:32:57-05:00

Why Invest in Alternative Investments?

The following offers an explanation behind increasing investor allocations into Alternative Investments. The investment returns of many Alternative Investments result from the fundamental performance of the underlying business or project versus the more general swings of the equity and bond (Fixed Income) markets.  Alternative Investments tend to offer Total Returns as well as Non-Correlated Returns based More >

Why Invest in Alternative Investments?2020-12-18T10:30:48-05:00

The SEC: Its Role with Private Equity and Private Finance

Enron. Bernie Madoff. WorldCom. Tyco International. Bre-X Minerals. Qwest Communications. Recognize these names? We’ve all heard the stories: rich schemers who deceive Investors, make false claims about their Companies, and pocket fraudulently generated profits while obliterating retirement savings from thousands of small (and large) Investors. Who protects us from cons like these? More >

The SEC: Its Role with Private Equity and Private Finance2020-12-18T10:28:18-05:00
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