Crowdfunding from the Investor's Perspective (Series: Crowdfunding)

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Practical and entertaining education for
attorneys, accountants, business owners
and executives, and investors.
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DISCLAIMER
The material in this webinar is for informational purposes only. It should not be
considered legal, financial or other professional advice. You should consult with an
attorney or other appropriate professional to determine what may be best for your
individual needs. While Financial Poise™ takes reasonable steps to ensure the information
it publishes is accurate, Financial Poise™ makes no guaranty in this regard.
About this PowerPoint: if you are looking at this PowerPoint without the benefit of
listening to the conversation that surrounded it then you are doing yourself a disservice.
This PowerPoint was prepared in contemplation of being viewed in conjunction with
listening to a one hour webinar on the topic
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MEET THE FACULTY
Moderator:
Jordan Fishfeld – CFX Markets
Panelists:
Nick Giovacchini – AlphaFlow
Markley (Mark) S. Roderick – Flaster Greenberg, P.C.
Joy Schoffler – Global Brand Strategist
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ABOUT THIS WEBINAR: Crowdfunding
from the Investor’s Perspective
This webinar focuses on the opportunities that crowdfunding makes available to the
investor, and how the investor should go about navigating this new world. We begin with a
basic overview of the new regulatory regime, the requirements to invest, and the on-
boarding process one should expect. We then dive deeper into the market opportunity,
including how to access and select investments, and expectations investors should set for
themselves and the projects they select. This is not intended to support any specific deal
selection, but instead sheds a light upon the basic selection criteria available, the method
to go about investing and what to avoid.
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ABOUT THIS SERIES:
Crowdfunding 2019
Since the passage of the Securities Act of 1933 and the Exchange Act of 1934, no regulatory change
has had such an impact on the capital markets and flow of capital for investors and entrepreneurs
alike as the JOBS Act. Originally intended to encourage the funding of small businesses, and
passed under the Obama Administration, Title III of the Act, or the CROWDFUND Act, has become
a major source of opportunity and stress. This Series explores the numerous titles of the JOBS Act,
expanding from the legal definition of crowdfunding, meaning only Title III, to the more common
use, meaning capital raising by public solicitation. This includes components of Title II, Title III and
Title IV. This webinar spends little time discussing the legal nuances, and focuses more on the
practical application and use cases, along with the opportunities and pitfalls of the new legislation.
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EPISODES IN THIS SERIES
5/7/19 Episode #1:
Crowdfunding from the Investor's Perspective
6/4/19 Episode #2:
Crowdfunding from the Start-Up's Perspective
7/16/19 Episode #3:
Securities Crowdfunding for Intermediaries
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Dates shown are premiere dates.
All webinars will be available
On Demand approximately 4 weeks
after they premiere.

Episode #1:
Crowdfunding from the Investor’s
Perspective
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CROWDFUNDING TYPES
• Donation
✓ GoFundMe
• Rewards
✓ Kickstarter
• Investment
✓ Republic
✓ Fundrise
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REGULATED INVESTMENT-BASED
CROWDFUNDING
• Investment based securities offerings and sales must either be registered with
the SEC and offered publicly or exempt from registration and offered privately,
usually under Regulation D
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JOBS Act Exemptions
• Tile II
✓ Regulation D, Rule 506(c)
• Title III
✓ Regulation CF
• Title IV
✓ Regulation A+
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ACCREDITED INVESTORS DEFINED
• Accredited investors include natural persons who:
✓ possess a net worth (alone or with spouse) greater than$1 million
(excluding value of home, and not counting home mortgage as a liability,
unless it is underwater) or
✓ have an annual income greater than $200,000 (or joint income with
spouse greater than $300,000) in the 2 most recent years, and reasonable
expectation of similar or higher income in the current year
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TITLE II
• Update to traditional Reg D offering
✓ General solicitation is allowed, but shifts the burden for accreditation
verification to the issuer.
✓ No limit on how much issuer may raise in 1 year
✓ Accredited investors only may invest
✓ No limit on investment amount by those verified accredited investors
• Most common form of crowdfunding we see today
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TITLE II (cont’d)
• Exempt from state registrations
• Can be sold through portals that do not need to register with the SEC
• Limited to 2000 shareholders before public filing required
• Available to foreign investors
• No ongoing reporting required, but suggested
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TITLE III
• Issuer limited to raising $1 million in 1 year, which grows and is now 1.06
million
• Anyone may invest, but investments are limited to income and net worth
• General solicitation allowed, but only through registered portals
• Issuers may rely on investors for income and net worth statements, unlike
506(c)
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TITLE III (cont’d)
• Moderation ongoing reporting required
✓ Intermediaries must provide “investor education” on their portals and
platforms to teach investors, for example, risks of investing in private
equity, including loss and illiquidity and conduct background checks on
officers, directors, and 20% equity-holders of each issuer, and disqualify
same if any one of them is a bad actor
• Not available to foreign investors
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TITLE IV
• Issuer limited to raising $20 million (Tier 1) or $50 million (Tier 2) in 1 year
• Anyone can invest, no accreditation required
• Investment amount unlimited (Tier 1) or tied to income and net worth (Tier 2
10% of either per deal)
• Blue Sky review for Tier 1 but not Tier 2
• General solicitation permitted
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TITLE IV (cont’d)
• Substantial pre-fundraising requirements and post-fundraising
requirements
✓ Must submit information to the SEC for approval
✓ For Tier 2, must have audited financials
✓ Ongoing reporting in details, akin to a mini-public company for Tier 2
securities
• No foreign investors, except Canadians
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DUE DILIGENCE
• What type of due diligence should an investor complete:
✓ Platform diligence
✓ Personal diligence
✓ Deal Diligence
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PLATFORM CONSIDERATIONS
• Does the investment platform curate its offerings or is it a billboard?
• Is the issuer appropriately registered as a business entity?
• Where in the process is the issuer as a growing company?
• Where do the financial projections of the issuer come from?
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PERSONAL CONSIDERATIONS
• Invest individually, or through a trust or some other entity
• What tax consequences will follow from choice of investment
vehicle
• What are your rights or liabilities if the investment fails
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DEAL DILIGENCE
• Review the terms and financials of the deal
• Use third party data sources to verify all assumptions
• Try to meet with the management team or at least have a call
• Understand the risks
• Never invest what you can’t afford to lose
• If it is too good to be true, it probably is
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WHAT TO CONSIDER WHEN INVESTING
• Am I knowledgeable about this investment category
• How does this investment fit within my portfolio
• Does the Sponsor have a particular expertise in the area I am investing
• Can this investment be made in a tax-beneficial account
• What are your liquidity options with this investment, and does that matter
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ABOUT THE FACULTY
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Jordan Fishfeld – Jfishfeld@gmail.com
Jordan is the co-founder and CEO of CFX Markets, an online trading platform for non-public
investments that is transforming how people view and hold alternative asset positions. CFX Markets is
venture-backed with offices in Chicago, New York and California. As an early innovator in the
crowdfunding space, Jordan assisted on the rule development of many online capital and crowdfunding
rules in a number of different states and federally. Jordan is also the elected Treasurer of the
Crowdfunding Professional Association (CfPA), and continues to advocate and educate on behalf of the
crowdfunding industry.
Additionally, Jordan is a board member of the young professional real estate division of the Jewish
United Fund and a Board Member of UpStart, a San Fransisco based accelerator focused on Jewish
engagement and innovation.
As a result of Jordan’s passion for working with the Jewish Community, he was also named by Oy
Chicago and the Young Leadership Division of the JUF as one of Jewish Community’s 36 under 36. Prior
to that, Jordan worked as a finance attorney for Katten Muchin Rosenman, LLP, where he assisted on
more than $1 billion worth of syndicated loan transactions.
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Nick Giovacchini – nick@alphaflow.com
AlphaFlow’s mission is to make it easier to invest in previously inaccessible asset
classes. Nick Giovacchini is the Director of Client Services at AlphaFlow and is
focused on managing AlphaFlow’s accredited investor platform, AlphaFlow
Optimized Portfolios, which invest in short term residential real estate loans.
Prior to joining AlphaFlow, Nick worked for Barclays Risk Analytics and Index
Solutions team, working with institutional asset managers to analyze risk and
performance drivers of their portfolios. He also was an Account Manager for
MarketFactory, a leading technology provider for the Foreign Exchange
world. Nick graduated from The George Washington University with a BA in
Political Science in 2012.
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Markley (Mark) S. Roderick –Mark.Roderick@flastergreenberg.com
Markley S. Roderick concentrates his practice on the representation of entrepreneurs and their
businesses. He represents companies across a wide range of industries, including technology, real
estate, and healthcare.
Expanding on his in-depth knowledge of capital raising and securities law, Mr. Roderick is
spearheading Flaster Greenberg's Crowdfunding Practice. He also is a member of the firm’s Mergers
and Acquisitions, Business and Corporate, Taxation and Healthcare Groups.
Mr. Roderick writes and lectures frequently for professional groups. Recent lectures have covered
raising money from investors, franchising laws, and business contracts. He also maintains
a Crowdfunding blog, which contains news, updates and links to important information pertaining to
the JOBS Act and how Crowdfunding may affect your business. For more information, follow Mr.
Roderick on twitter @CrowdfundAttnyor visit www.crowdfundattny.com.
To read more about Mark, please visit:
https://www.financialpoise.com/financialpoisewebinars/faculty/mark-roderick/
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Joy Schoffler – joy@ideationhq.com
Joy is an award winning global brand strategist to business, government and high profile individuals. She is an
expert at helping financial brands accelerate growth by building systems and messaging to attract and convert
customers, investors and key-stakeholders. She started and sold one of the fastest growing PR firms in
America, Leverage PR to NY based Caliber Corporate Advisers. At Leverage, Joy represented numerous
financial services companies including dozens of crowdfunding related companies, hedge funds, real estate
investment firms and financial technology firms across a number of verticals. Core verticals included: banking,
payments, accounting, cyber security, investment tech, regulation technology, and lending among others. She
additionally represented brands like SXSW, The Economic Ministries of Japan and Brazil in addition to a
number of high profile individuals. Joy additionally ran media and events at the White House, US Capitol, UN,
a Shark Tank casting call and a Mark Cuban event among others. Joy has sat on several boards including the
SXSW Accelerator, AARP’s FinTech Advisory board, FinTech Professionals Association, Crowdfunding
Professionals Association, and Crowdfunding Intermediary Regulatory Advocates. Her crowdfunding boards
worked with the SEC and FINRA on JOBS Act implementation, enabling online investing as we know it today.
To read more, go to https://www.financialpoise.com/financialpoisewebinars/faculty/joy-schoffler/
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QUESTIONS OR COMMENTS?
If you have any questions about this webinar that you did not get to ask during
the live premiere, or if you are watching this webinar On Demand, please do
not hesitate to email us at info@financialpoise.com with any questions or
comments you may have. Please include the name of the webinar in your email
and we will do our best to provide a timely response.
IMPORTANT NOTE: The material in this presentation is for general educational purposes only. It has been prepared primarily
for attorneys and accountants for use in the pursuit of their continuing legal education and continuing professional education.
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The Investor’s Guide to Alternative
Assets: The JOBS Act, “Accredited
Investing,” and You.
"The Investor's Guide to Alternative Assets: The JOBS
Act, “Accredited" Investing, and You" provides a
thorough, objective, and plain English introduction to
investing in alternative assets.
Chapters include overviews of angel investing and
venture capital, private equity, hedge funds, and so-called
"hard assets." An introduction to crowdfunding is included
to help you decide whether investing via a crowdfunding
portal is for you. Other topics discussed include the JOBS
Act itself; "alternative mutual funds," and a host of others
that will arm you with the information you need in order to
make educated investment decisions.
Available on Amazon Kindle and Financial Poise.com.

ABOUT FINANCIAL POISE
DailyDAC LLC, d/b/a Financial Poise™ provides
continuing education to attorneys, accountants,
business owners and executives, and investors. Its
websites, webinars, and books provide Plain
English, entertaining, explanations about legal,
financial, and other subjects of interest to these
audiences.
Visit us at www.financialpoise.com.
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