The Key Elements of a Compliant Mortgage Fund and a Successful Pitch Deck

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Kevin Kim, Esq., Partner at Geraci Law Firm, and Ruby Keys, VP of Geraci Media, shared their tips for creating a successful and compliant mortgage fund and marketing it through a pitch deck that will wow your investors.


Ruby Boulanger:

Good morning everyone, and welcome to our webinar that we are doing today. Kevin and I will be discussing the key elements of a compliant mortgage fund and a successful pitch deck.

Kevin Kim:

All right, good morning guys. So thank you for joining us today at this Geraci webinar. My name is Kevin Kim. For those of you do not know me, I'm partner here at Geraci LLP manage the firm's corporate and securities team. My area of expertise lies in advising, designing and creating debt funds, mortgage funds, private lending funds, whatever you want to call it, have background securities, been practicing law for 10 years. Also the lead instructor for the American Association of Private Lenders Certified Fund Manager course. It's a great educational series teaching the basics and advanced level topics for fund management. Today we're going to be focusing on some compliance and some legal aspects of marketing your fund and using a pitch deck. And Ruby here is going to be talking about the more practical aspects of pitch decks and the importance of marketing.

Ruby Boulanger:

Hi everyone. I'm Ruby here with Geraci Media. I manage our media division. We host conferences every year, which is kind of what we're most well known for. In the last year and a half. We've launched a full media division and that's where our pitch decks come into play. We do website development, logo design, brochures, SEO work, websites, and all of that. We also do a monthly magazine catered to loan originators and really highlighting those industry experts. So that is Originate Report. If you haven't heard of it before, we'll talk about that a little bit down the line, but right now we're going to start and jump into some standard questions. So starting out, what are the top three reasons a fund manager should create a pitch deck? And the first point I really want to touch on is the visualization of the investment opportunity. It's super important to have a presentation that's really easy to read, comprehend, and analyze. If you want your investor to notice you and stand out, you need to make them visualize what they're reading and why this opportunity really benefits 'em. The next point, professional and institutional approach to raising capital. I'll let Kevin kind of touch on that a little

Kevin Kim:

Bit. Yeah, guys mean, so the concept of a pitch deck is really a marketing tool, sales tool to visualize the investment opportunity. Ruby trusts on that, it's really important to take this with a very, very polished approach from smaller funds raising as little as a million dollars to institutions that raise money to broker dealers that do this for a living. The standard kind of, I guess unifying approach has been to use a very well-designed pitch deck. And when I say well-designed, it's also very, has a lot of the legal ease you need, has a lot of the professional touches to it, understanding what the key elements the investors are looking for. It's not just some Word document you put together. It's not a bullet point list of what the key terms of your investment opportunity are or your fund are. It really highlights the background, the principles, the opportunity comparisons.

And this is important because whether you're dealing with a retail accredited investor who's just a really wealthy person all the way to a institutional investor to be able to sum up the investment in a professional, polished manner says something about the opportunity, it creates a level of credibility, but it also helps explain the investment beyond the documentation that's supporting it. My job as an attorney is to create these deep, lengthy documents that explain and disclose the risks and mechanics of an investment, but frankly, that's oftentimes insufficient when you're sitting down at a meeting. The last thing you want to do is to open up a hundred page booklet in front of an investor who's really interested in your opportunity and wants to know more. So take it from the pros. Definitely this is something that's a common practice, it's definitely a best practice and something you should take very seriously and do well.

Ruby Boulanger:

And then the third point, capturing the attention of your investor and really I ask that you put yourself in their shoes. Would you rather read a long document on the investment terms? Hear someone really tell you a sales pitch or look at all the data and benefiting facts that's listed in front of you while you're saying your pitch. People need something to visualize and understand while you're talking and need to have something that's really eye-catching, yet simple, that is sophisticated, that lists out your investment terms and what you're offering.

Kevin Kim:

Right. And before we move on to the slide, I would like to comment on that as well is the idea of capturing the attention of your investors is so important in this day and age, especially as investors are getting younger, understanding that we are dealing with a younger audience. Attention spans are dwindling, and so to that degree you really need to have something that maintains their attention. Keep in mind a pitch deck is designed to be used in two primary formats. You're using them either as a kind of sit down, here's a booklet kind of thing. You put the pages or as a presentation, right? You're using it as on stage at a seminar or in a conference room on a screen. And so it has to be visually appealing, has to be easy to understand and has to maintain their attention at all times. And one of the biggest mistakes as you see is you see these pitch decks and these investor presentations that are just super dense and not a good idea. Investors' eyes is going to roll over in a second.

Ruby Boulanger:

Yes, a hundred percent. So what are the most essential components for creating a pitch deck? Accuracy, consistency, quality and compliance are really important factors with this. Your deck should be, again, super easy to follow and understand going into details, your formatting, font, and style should be consistent. I know a lot of people like to switch it up. This is something that's super distracting to investors and anyone who's reading any type of presentation, the goal is to really get your investor to engage with your deck and you don't want to take away from that with something as silly as multiple different fonts and too much tech sizing. Top-notch quality is really crucial. So if your deck is designed poorly or is too busy, this is probably going to do more harm than good. So I would say if you're not going to do a pitch deck, right, I really wouldn't do one at all. And then what not to do? I wouldn't just use a PowerPoint with standard font and clip art and poorly designed graphics. And later in the presentation I'll get into how we structure our decks and how we recommend really going forward to get the best attention and engagement.

Why is it important for pitch decks and fund documents to be uniform? I know Kevin will have a little bit on this, but from my perspective it's important to make sure you're conveying the right and accurate information. Your pitch deck should really be a way to beautify and simplify your terms, your investment terms.

Kevin Kim:

So guys, this is kind of where I come in. I've seen this mistake happen a lot where the pitch deck and fund documents, the offering documents, the PPM, the LP agreement and the subscription agreement, they don't line up whether it be internally at the fund document level or in line with the pitch deck giving inconsistencies. And this is really dangerous because at the end of the day the pitch deck is a compliment to your offering to your investment opportunity. It's designed to be a presentation to kind of sum up the opportunity, not constitute an offer of an investment, but still at least give them the key terms they need to understand whether they should invest or not. And to that degree, if there's any inconsistency between the terms, you run into a situation where you could end up landing in what we call misrepresentation material fact.

And it's a term of our, it's one of the key elements to securities fraud, whether it's civil or criminal, and it is a slippery slope guys. And so one of the most important things you can do when you're creating a pitch deck is to make sure that your securities counsel is reviewing it because if there's any inconsistency, a good example is we see preferred return rates not necessarily, or fees not necessarily be accurately reflected in the pitch deck. And you have a problem there because if the investor is expecting X, Y and Z based on the pitch deck and you deliver the offering documents and they identify the inconsistency, then you've got egg on your face, it's embarrassing. And then if the investor is not as thorough and may just move forward and sign up and then they receive their distribution check, well now you've got a more serious problem because you have now misrepresented to them and be a marketing documentation that that's also can be demonstrated used as evidence that they expected to receive, I don't know, 8%, but in reality they were very, very far off the mark.

Or for example, the asset class, if the pitch tech explained that the asset class the fund is going to be investing in is for example residential fix and flip in the western United States and all of a sudden in the first month of investment the fund is concentrated primarily in industrial properties in the southeast, you've got a problem. And so making sure that it's pretty consistent throughout is something that your attorney will harp on. I will definitely stress on and Ruby will also be stressing on, and this is why it's so important to make sure that your marketing materials are reviewed and approved by counsel.

So another thing we want to talk about today is we have to also talk about the legal issues that come up with marketing and using a pitch deck for a fund. So what are the legal issues that you need to be aware of? There are kind of three big buckets we want to talk about here today. The first big bucket is making sure you have adequate disclosures and disclaimers in a pitch deck. Why is this important? So the issue you run into here is the one thing you do not want your pitch deck to do or B, is to be construed as an offer to sell securities. That's the ppms role. The role of the PM, the private placement memorandum or the offering circular or the prospectus or the offering memorandum, whatever you want to call it, is the offer of the securities to purchase the securities.

If therefore you need to make sure that your pitch deck is really the usage of it and the scope of it is limited to basically an explanation of presentation. Only having those types of disclaimers in there is essential. On top of that, as most of you already probably know if you listen the radio or watch tv, there are a lot of commercials and you want to have a lot of disclaimers explained. There are risks to this investment because this is a marketing tool, it is being used to represent that you are offering these investments and you are in the business of having this investment opportunity. And to that degree there needs to be a disclaimer stating that the terms of this investment are governed by a formal set of documents and B, that there is risk, that there is risk to this investment. It's not risk free, it's not risk, it's not risk mitigated, there are risks to it, you may lose money, you may lose your principal, so on and so forth.

So to that degree, we usually recommend that a pitch deck has a significant section dedicated to disclaiming those types of standard issues that we find as securities attorneys. On top of that, you make sure you have adequate disclosure. Adequate disclosure is the key terms. While this is not an offering circular or memorandum or PPM, it should have sufficient explanations as to what the key terms are and they should be accurate. If you're going to be using ranges or terms that that are designed to protect you so you're not locked down to a particular figure, then if that's the case, they take the approach that you want take, then you need to make sure that it's within reason based on your portfolio today, based on your plan portfolio in the future and in the direction you are heading. And also disclosing that to the business model and the asset class and other aspects of it.

These disclosures need to be accurate, they need to be adequate, they need to be giving sufficient information to the investors so they can use this to make an informed decision and take the next step into reading the PPM. The next thing here is marketing and solicitation regulations. So this goes in line with the securities exemptions that are being selected by the sponsor, the issuer, the person, the fund manager, the one that's actually raising the money, right? So if the fund manager chooses 5 0 6 B regulation D, rule 5 0 6 B as in bravo, this exemption does not necessarily allow you to market freely or solicit investors generally. Now I won't go into the details as to what constitutes general solicitation, but it is very, very restrictive. Basically you have to have a preexisting business relationship with the investor before you deliver any kind of materials on the investment.

So understanding when and how you use this thing and what exemption you're relying on is going to be key On the flip side, another commonly used exemption is regulation D, rule 5 0 6 C as in Charlie, 5 0 6 C lets you advertise in market freely and just solicit generally to investors that you do not know. However, you are limited to accredit investors only and you must verify their accredit investor status to that extent. The pitch deck should probably reflect that fact, making sure that you're aware of these restrictions, that wearing aware of these regulations and navigating the way you use your pitch deck and ensuring the disclosures and materials in the pitch deck are in conformity with your legal selection is paramount. I cannot stress that enough. Third here has to do with we call puffery, it's kind of a legal word, we don't like to use practical terminology.

This is kind of used amongst securities attorneys and also regulators. The idea of puffery is really in layman's term, it's really an overstatement of the facts. We do not want to inflate the opportunity. We do not want to make it seem better than it really is. Being accurate, being conservative in your marketing is going to manage expectations very well. And on top of this omission or misrepresentation of material fact, there are some key terms that you must not misstate. One, a good example is going to be the distributions to the investors, the asset class in which the fund will be investing in even the principal's background and the opportunity presented based on the fees and that kind of stuff has to be accurately stated and there are areas that you can have some flexibility with, but there are some things you just cannot misstate. And another thing has to do with this is one of the things that we catch a lot is lenders who have a debt fund will often want their pitch tech to state, oh yeah, we're authorized to lend in all 50 states, we're authorized to lend on all asset classes, but that's a gross misstatement of the law and of their licensing arrangement because you need to be licensed in certain states to lend.

And so that is a misrepresentation of material fact because that is the investor is expecting you to have a gross national application to your investment portfolio if you are not allowed to do so. It can be viewed as a misrepresentation of material fact. So I want to make sure that we're not overstating, inflating or forgetting to be accurate about certain issues. And this is once again another reason why you want to make sure that your attorney, especially your security attorney is reviewing your marketing materials including your pitch deck.

Ruby Boulanger:

And then one more question that I have, I know you touched on it a little bit, but what would you say are some of the examples you've seen of legal restrictions that lenders are making when they're trying to market their investment opportunity?

Kevin Kim:

Well, so there's two kind of aspects to look at this, right? So you're looking at it from a securities perspective and you're also looking from a lending perspective. So from an investment perspective, we want to make sure that we're not violating the way the rules associated with solicitation and marketing. So I talked about earlier on 0.2506 B as in Bravo versus 5 0 6 C as in Charlie or regulation A tier two, depending on the exemption that you're using will dictate how you can market your investment opportunity. That's one thing that's commonly overlooked. People think that if they're offering a 5 0 6 B as in Bravo, they can get on stage to a group of people they never met in their life and do a pitch. Unfortunately the law says you cannot. And so making sure you're following the rules there. On the lending side it's important because the investors are investing with this fund particularly because they like the asset class.

And so like I said before, the 50 states thing, making sure that you're accurately disclosing any license numbers accurately disclosing the asset class you'll be pursuing, accurately disclosing the strategies in which you'll be obtaining those assets, the LTVs, all these things are commonly overlooked things. A lot of guys try to have a blanket statement across the board and unfortunately I don't think investors accept that anymore. Investors are smart enough to know what they like and what they don't like and if their presentation leads to more questions at the end of it, well what's going to be done with their money? I think that's not a properly prepared presentation.

So the next thing here is how do you market your fund in compliance with local and federal securities law? So I touched on the federal earlier. So most of debt funds out there are going to be relying on some federal securities exemption, right? So 5 0 6 B as in Bravo, five six C as in Charlie, regulation A. These are all exemptions to the registration requirements of the 33 act. So if we are using these exemptions, each of these exemptions have specific rules in how you can or cannot market your investment opportunity. We covered that earlier in the previous slide. On top of that, there are local regulations at the state level as to how you can market or solicit investors in certain states won't go into every single one. We don't have time for that today, but it's important to consider are there local restrictions in my home state associated with a, for example, 5 0 6 C or regulation A offering that allows you to market generally to the public.

These states may have some filing requirements, some registration requirements, some exemptions that you need to file for, but there are certain regulations there and I know some of you who are more sophisticated in the audience, well wait a minute, I thought regulation D 5 0 6 BNC preempt state law. They do. It does preempt state law. However, local governments are still allowed to govern the manner in which you sell in their states and so they can still impose a little bit of restriction on you. And so making sure that you're navigating those issues. For example, I think Arizona is one that's well known for this, is you have to make sure you're navigating those issues. Consult securities counsel if you plan to do it. That was CA regulation A offering before you do that because the law will be very, very specific as to whether they allow you to just market to the public based on your offering. But frankly, most of my clients, even if they are offering a product that allows 'em to generally solicit the public, are still taking a very tailored and bespoke approach and getting to know their investors because it's still best practice.

Alright, so next topic here. What are the top three legal issues and fund formation? So before we started talking about pitch decks and what's so important about a pitch deck and what you need to think about when you're doing a pitch deck, we also talk about the basics and marketing a fund and thinking about that. But some of the things a lot of this lines up with if you haven't started your fund or you already have your fund, there are some legal issues that are commonly overlooked that are legal issues that are very important that need to be stressed. So that's why we're talking about this today as a kind of refresher. So the first one is choosing the right exemption for you. So it really boils down to do you want to market this opportunity to the public? Are you comfortable with just limiting yourself to high net worth accredit investors only?

And also on top of that, how much of a public audience, how public offering do you want to do? And so it boils down to how much do you want to market and what your investors are going to look like. This will dictate how you choose your exemption. On top of that, it also boils down to the geography, right? So at the end of the day I always ask three key questions. Do you need investors that are not accredited? Do you need to market this thing publicly? And lastly, do you want to raise capital nationwide? Typically the answer is, I don't need non-accredited. I'd rather have accredited investors. I'm okay with verifying them. I want to market this thing and I want to go nationwide in that context. Regulation D, rule 5 0 6 C as in Charlie is your best option, but frankly that's not the only option on the table.

Some of our clients are saying to us, we want to go national, we want to go as many non-accredited as we want and we want to a crowdfunding approach. Okay, regulation A tier two is probably the better exemption. So making sure you choose the right exemption for you. And I have plenty of clients choose one, they go out to the market and they realize, oh wait a minute, our accredited investors don't like getting verified. We've got big investors that are sensitive to this issue. Can we think about a different exemption? So making sure you're consulting with counsel before and during, making sure that it's still a good fit for you. Next thing here is disclosure of material fact. This is the obligation on any security that you're offering. This goes to the necessity of a properly drafted private placement memorandum offering, memorandum offering, circular prospectus, however you want to call it.

The idea is offering documents and the breadth and depth of those documents. I'm a big believer that regardless of whether you're raising money from a hundred percent institution, institutional or high net worth, or just your average mom and pop investor that you should have a offering, circular offering memorandum, private place of memorandum, put together. It not only protects but also protects them. It discloses the fact that there are risks to this investment. It covers all of the flexibility points that you're going to need to operate the business and the investment and all that is material fact because material fact is defined as what a reasonable investor will want to know. And so best practice is to have that documents set put together. One thing I want to stress is that a pitch deck is not a replacement for A PPM. I've seen that in the marketplace.

Do not think that a pitch deck is sufficient. It is not. And the law states that if you have a single non-accredited investor, you must give them the equivalent of a offering, circular offering memorandum that's in line with federal standards and all the other investors must also get that. And so that's important. And I know the Connor to that is, if got credit, it's only do I really need it? My answer is yes, because it's a best practice and protects you. It's also industry standard and you will not be able to raise money successfully without it because any investor that's sophisticated enough who's invested in private placements or private deals is going to want to see that. Lastly is going to be ongoing compliance. I can talk about this for hours and hours on end, but the most important thing is marketing policies based on our topic today.

Making sure that you have coherent and flexible marketing policies that are in line with your exemptions, restrictions and regulations, making sure that your securities counsel is reviewing all of this and understanding that you will be marketing this thing and giving you best practices on top of that, making sure that your pitch deck is being used properly in compliance with legal restrictions and regulations. And on top of all of that, that pitch deck is one component in a broader scheme of marketing and making sure that the council is aware of all of your strategies. If you want to have a online presence, if you want to have Google ad works, if you want to do all these other things that were out there, council needs to know about it, making sure it's in line with the regulatory restrictions that are available to you based on the exemption that you've chosen.

All right, next topic here. So what are the most common mistakes in mortgage fund management? So because the topic today has to be more in line with pitch decks and marketing and actually a good opportunity to discuss is number one, most common mistake in mortgage fund management is not understanding the breadth and scope of the exemption that they have chosen to this day. There are, I get calls from clients who've been doing this for decades and still asking, confirming, making sure they're doing it right, exploring different options. And the reason why they do that is they want to make sure they're maintaining compliance on top of that. Another big mistake I see is it has to do with marketing and investor relations is essentially you've got an investor complaint, whether it be unfounded or not. The biggest mistake I've seen is that the sponsor, the fund manager will either ignore or bury their head in the sand or just kind of be not responsive.

It's the last thing you can do, but the worst thing you can do, getting ahead of it and figuring out a strategy to own up to it, and of course limiting your exposure from a legal standpoint. But doing that, getting ahead of these issues is going to save you heartburn, legal fees and liability in the future. And then lastly, I want to talk about how mortgage fund managers are allocating their time. One of the biggest mistakes I've seen is fund managers. They try to keep their business lean and mean, which is a good thing. I commend them for that. But one of the things you can do while keeping lean and mean is to outsource services and to use different organizations to help. And this goes in line with the concept. What I want to talk about is the idea of is if you are wasting your time with your head buried in a spreadsheet, making sure that your investors K ones are accurate, distributions are accurate, or your loan servicing is accurate, or you are obsessing about the way your emails are set up or what have you, and you're not focusing on the two big things that you should be doing, raising money and finding loans, and you really got to think twice about how you're operating your business.

And this goes in line with using third party marketing services, using graphic design, using a professional service to help you with your pr. That's also stuff that you can definitely do without having to bring on staffing internally and and mean on top of that loan servicing, fund administration, CPAs, accounting, legal, all this stuff should be, you can think about how do I not have to spend so much time doing this myself? And that's a big mistake because that at the end of the day boils down to essentially boils down to the idea of it's going to hinder you from growing, right? And so it not only hurts your bottom line, but it also hurts your investors. Your investors are investing thinking that this fund, their investment is going to grow, the portfolio is going to grow and they start earning better returns as a portfolio grows.

So probably the most common mistake I've seen is getting in the weeds too much and not focusing on the most important aspects of operating this lending business. And this investment fund is going to be not concentrating on the two big things is raising capital and finding loans. Another ancillary kind of common mistake that we oftentimes see is basically you have stale documentation. And this is oftentimes just, I guess a mistake of being very, very busy and it's a good thing to be busy. It's another reason why thinking about outsourcing services is I've seen a lot of funds that have documents, whether it be their legal documents or their pitch decks or their marketing campaigns or their website or whatever you have you. It's outdated. It looks stale. Legally speaking, it's a risk because you aren't updating your disclosures in your PPM, you aren't giving performance reports to your investors on the portfolio.

Very big risk because you're not disclosing material fact to your investors. And so making sure you're doing that is very, very important. But on top of that, I've seen that mistake happen on client will put together a pitch deck when they found the fund, founded the fund five years ago, and they're still using the same deck and it has outdated market data, has outdated index comparisons, it's got outdated return history, it's just not up to date on top of that, it looks stale. It looks like it was designed in the early two thousands and that also can turn off investors. So that's hindering you from your growth because your investors, like I said before when we first started, investors are getting younger and more sophisticated. They're not going to pay attention to something that looks stale and old. And so making sure that you keep these things up to date, it's something that you really want to consider, not just your offering documents and your legal stuff, it's also your forward facing materials that should be updated on a frequent basis. Okay. Alright, next slide here. So what are the biggest mistakes you've seen in fund marketing material? So I kind of want to give Ruby a little bit of time here to chime in here because Ruby, you review and look at a lot of debt funds and lending businesses, marketing materials on a day-to-day basis. So

Ruby Boulanger:

Yeah, so a lot of the times when we either create pitch decks or we have one that needs to be redone, we'll see that they're too dense. So our kind of sweet spot and recommendation is 15 pages and under, however, there are some cases where they need to be over, but anything that's 30, 40, 50 pages, it's just too much. So I mean put yourself in their shoes again and look and see what matters and what is distracting. So also lack of relevant data, touching on what I just said and then inconsistency and inaccurate. What we recommend is going through having a simple cover page that's designed, obviously approved by you. Disclosures are super important to have in there. The minimum maximum offering amounts meet the team. This is something where you are kind of giving your personal touch to the deck and feel. So I would definitely include your key executives.

You don't need your entire company. And everyone listed in there, targeted opportunities, structure, really going over why private lending is the industry that they want to invest in. Past deals is another good point to put in there. This gives credibility for the investor when they're looking at this, having your process listed out. So what should the investor expect if they were to invest with you and partner up with you? And again, why you? There's a bunch of people doing this. So make sure you kind of have that differentiating factor and we'll go through and help you with a lot of this content, but again, we can't say why you need to kind of think of that on your own. And then we'll go in there and kind of make it pretty and add some personal touches in there as well. And then we'll work with our securities team along this entire deck to really put in why this market is the best market to invest in. So outperforming the market section is another really crucial one that we recommend and normally like to close our decks with.

Kevin Kim:

I want to chime in here on the lack of relevant data. I mean we talked about earlier on the inconsistency and accuracy, that's a legal issue, making sure everything's lined up with your investment terms, that's so important. But relevant data is something that we've seen time and time again. One common mistake is, okay, I'm going to compare my fund's performance with a Wall Street asset or index or ETF or fund that exists that has a comparable asset class but a much lower yield. And what ends up happening is they're not digging deep into the asset class and they end up going in a different direction. It's not the same investment opportunity. And so being very careful, if you're going to quote, if you're going to cite two different comparable Wall Street opportunities, you want to make sure that it's comparable, it's actually relevant. If you're citing an s and p index fund, it's not going to be a comparable investment if you're citing a TBI investment, I don't think it makes sense because it's highly not going to compare.

And so it makes sense to start looking at, well, the reason why these private placements are much more attractive is because the asset class is a higher yield compared to a traditional, for example, mortgage REIT that's out there, that's an ETF, something like that is probably going to be more relevant on top of that fund performance. So if you've got data in there about your performance, some of the things that are irrelevant are going to be, are things to talk about that are irrelevant, are going to be some of the points associated with the portfolio that may not be material to your investors. Some fee arrangements that may not be necessarily that important. Some issues associated with your returns are very important, but making sure that making you're not necessarily doing a data dump, if you will, is going to be important. But on top of that, showing past history on returns, annualized returns is going to be important.

I wouldn't do comparisons that are too granular, maybe monthly or quarterly. Doing an annualized kind of comparison year to year is important. Also, relevant data is also going to be like I've seen mistakes where there are clients that compare the fix and flip market to the conventional market and if unless it's positioned properly could be viewed as very relevant. And so making sure because the, for example, flip market is much larger today than it was five years ago. And so making sure the data that you're citing is super relevant and also making sure that it's positioned properly is going to be very important to making sure it makes a difference. Otherwise it's just fluff in the presentation. All right, so

Why should securities counsel review your pitch deck? So we talked about this throughout the webinar today, various legal issues that come up with a pitch deck, but at the end of the day, it's to keep you in compliance to avoid future liability and lawsuits to ensure that you're not triggering other regulations that we didn't discuss. Say for example, the Investment Advisor Act. And on top of that, making sure that your attorney is aware of what you're doing so that they can advise you on best practices. One of the things that we do here with our fund clients and our other people have investment vehicles is talk about best practices on an ongoing basis and be available to them to run ideas of, can I do this in my marketing endeavors? Can I have this arrangement with this consultant? Making sure that council is available to you and willing to give you that kind of feedback on how you plan to operate the fund and how you plan to market the fund. The investment opportunity is so important because once again, you're not an attorney and you want to make sure that you are operating in compliance. And so having that resource available to you is paramount to success and to compliant operations.

Ruby Boulanger:

And all of our proposals that we put out, whether you're looking to do a fund through Kevin and have a pitch deck quoted through there or you come through me first, we price out to have the attorneys review everything just because we are tied to the law firm and we want to make sure that everything we put out is legally compliant. So every pitch check that is done through Geraci Media is reviewed by our corporate insecurities team and they'll give edits that we'll consult back with you and just to make sure that everything is really 100% good to go when you are looking to go out and raise

Kevin Kim:

Capital. And to expand on that point, if you are a client and we are working on your fund, the additional value add on top of that is we're also going to be giving you the best practices on taking this out to the market. We're working with consultants and having a big picture strategy session on best practices overall as kind of a closing call to your fund as after we got your documents ready. So you now know here are your materials, here's what not to do when you're raising money, here's what you should be doing and here's some pitfalls to watch out for. We do that very frequently with our clients and we make ourselves available to them on an ongoing basis to run ideas by to make sure that they're not going to run a foul of securities regulations, both local and federal.

Ruby Boulanger:

So key takeaways from today, the first point is capturing the attention of your investor is really crucial. Second, sufficient data and analytics play a really important role with this. And third securities council for your fund and deck are extremely important.

Kevin Kim:

All right guys, well, so as part of today's webinar and as kind of a announcement to the listeners today, Jussi Media and Jussi Law Firm work hand in hand in creating funds and doing marketing work for the funds. And so we're offering this special code to get you a discounted fund document and pitch deck combination. It is for webinar app attendees only, and this only is extended to the end of the year. You must be signed up and paid by the end of the year and there are some trends and limitations that may apply. So if you're interested in creating a fund or having fund documents drawn up and doing a pitch deck, it's a good opportunity for those who are listening today. We really appreciate you joining us today for this webinar and look forward to you joining us for additional webinars and podcasts here at Geraci.

And before we close out the webinar, I think we have a little bit of time, so kind of want to go into some questions here before we close out and do some housekeeping. So let's take a look at the questions here. Well, we got a question here about cost. I think I just gave that to you, Larry, so give me a call, Larry, if you want to talk about it. I think we just talked a few hours ago, so happy to talk to you about that. On top of that, we got some questions before we started, so I want to make sure we cover that. There's two questions here about, so one's about are all private mortgage rates capped at 10%? And I'm not quite sure where this information came from, who the question is from, but this is not necessarily the case. Interest rates are capped because of local laws governing usy and also there are market conditions that will impact what the going rate for a certain type of loan are going to be.

So the answer to that question, no, I've seen plenty of lenders out there that lend above 10%, seen plenty of lenders out there that lend below 10%. So definitely worth exploring If you want to have a more detailed discussion on that, whoever asked the question, please give us a call here. Tara Geraci. Next question here. Are there JV opportunities where you can take equity or a fee as money is raised to reduce or eliminate upfront costs? I think this question is going to, can we join up with others to raise a fund up and reduce our costs? And I've seen that before. It is very, very important to consider. One, you're adding one additional wrinkle in the fact that now you've got to explore corporate formalities between the two arms length groups, if you will, right? So if group A and group B are joining forces to create this investment vehicle and lending company outlining who's doing what, who has title, who says on the board, who makes what decisions, if there's more power from one group than the other who gets veto rights, these are corporate formalities that need to be discussed.

I think that's what I was understanding the question to be. If I missed the point of the question, whoever's from our audience member, please feel free to reach out to me and ask in detail. Last question here, is there a replay And answer is yes. This webinar will be recorded and information on how to access this recording will be provided via email after the webinar. And also if you're interested, please contact our marketing team at if you have any questions. I think that's it for today. I don't have any other questions here. Let's check one more time and making sure. Okay, here we go. So we got one more question. This is apply to syndications also, Michelle? Yes, it does. It does apply to syndications. Also, please give us a call. Typically we can do syndications at a lower cost even. So please give us a call to find out what kind of syndication you're trying to do. Happy to do a consult with you. I think that's all we have today.

Ruby Boulanger:

One thing I did just want to touch on, we have finalized our dates for our conference coming up. So February 20th through 21st in Newport Beach at the Balboa Bay Resort. We'll be hosting our Innovate Conference, which will target private lenders, brokers, some real estate investors, and some high net worth investors as well as service providers in the industry. It's one of the two events we'll be doing next year. So we would love if you guys could make it out. If you have any questions, please feel free to email myself or Alicia so we can go over that. And again, if there's any other questions on creating a pitch deck or pricing and anything else I can go over with you, I'd love to jump on a call and just discuss your situation and see if there's an opportunity for us to work together.

Kevin Kim:

Thank you for reminding Ruby. Yeah, I want to talk about housekeeping and definitely important. So Innovate Conference guys, very, very important to be a part of. For those of you who are in colder climates, it's a great excuse to get out to warmer temperatures in early winter. It's going to be in sunny, beautiful Newport Beach. But from a content perspective, this is a great conference to kickoff the year. And we're not only talking about industry trends, but a lot of the attorneys here at Geraci will be in attendance. So you can meet your favorite attorney here at Geraci you, and also get some legal advice while you're networking and meeting great people in the industry. Last I want to close out also to give a big thanks to our friends over at the American Association of Private Lenders. Thank you very much for helping us promote this webinar today.

And for those of you in the audience, I will be teaching a certified fund manager course this year in Las Vegas for the American Association of Private Lenders on the 7th of November. And that class is focused exclusively on teaching new and existing fund managers, securities compliance, advanced fund management. And this is the year guys, because we're going to be changing it up a bit next year. So this year I plan on doing a really, really deep dive and really talking about a lot of the up and coming issues on top of the core compliance topics that we usually discuss. So if you're in interested in education, we really encourage you to be part of that educational class at AAPL National Conference in November, and we hope to see you there as well. Geraci will be there in full force. Geraci Media and Geraci Law Firm will be there. We'll have a booth and we hope to see you there as well. And I think that's all for today. So thank you for everyone joining us today. Thank you for listening, and that's everything for today. Thank you very much.

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