I get calls on a daily basis from business owners that have all experienced the same cycle of scams in their quest to gain funding for their business. Let's see, there's the shelf corporation scam where one buys an aged corporation and believes that buy fraudulently adding verifiable lines of credit a bank will bypass all logic and give them $100,000's in non-recourse loans and lines of credit regardless of their sub 500 FICO score.
There is the Platform scam where an individual, business or nonprofit gives a modest deposit to an unlicensed securities dealer and this dealer has a unique relationship with a top MTN, BG, T-Strip or commodities trader in Europe and in a matter of a few weeks this trader is supposed to be able to take your $100k deposit (which secured a instrument from a top tier bank and then monetized it and took your money into trade) and make it into millions upon millions of dollars that you'll never have to pay back and abracadabra, you're an instant millionaire. Soon you find out that your contact's phone number no longer works and that bank account you wired the money to has been closed for weeks.
There is the reverse merger into a public shell scam where unknowing small business owners sees an adwords at for an ad that says something like "Public Shells for sale $10 million line of credit attached" and the client buys this shell which has liens, open lawsuits and a group of investors that retain 20% of the stock so they can pump and dump the stock and leave you curled up on a ball on your kitchen floor calling for mommy.
And finally there is the virtually obligatory Pink Sheet scam where, for a great price, you can take your company public with virtually zero interaction from the fussy SEC and a market maker group will even sell your shares for you and they are guaranteeing 400% increases in share price. And soon you find that this market maker was a boiler room that makes a living out of stock manipulation and in a matter of a few short weeks your stock is deflated to the point where you can't even give it away as an employee incentive.
Listen, if you want to raise capital and/or go public there is a much easier way. If you are seeking legitimate options to raise capital you can go with a Private Placement Memorandum which uses Regulation D Rule Exemption 504, 505 or 506 to raise fast cash from investors in a solid, SEC regulated structure. If you are a real estate investor, start-up or small/medium size business you can take your company public quickly and affordably via OTCBB (over the counter bulletin boards) and if you have lots of money and time you can do an all out IPO. The reality is you can even take your company public for minimal out of pocket expense by starting with an initial fundraising round using a Private Placement Memorandum 504 and then take the capital from that initial raise and pay for your OTCBB offering. It's unbelievably simple and there is zero out of pocket expense coming from you (with the exception of the PPM docs).
When you hear the terms Platform, Pink Sheets, Shelf Corp or reverse merger into a public shell, put down the phone or walk away from the meeting, you'll only get burned. A PPM and OTCBB are real, viable options if you are trying to raise real money, fast.
Author Resource:
Take Your Company Public , call Princeton Corporate Solutions at 267-233-0183 Go Public the right way.
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