5 Ways to Find Private Placements

This is an exceptionally crazy week for me with a lot of comings and goings! On a happy note, Kung Fu Grandma just arrived today (hooray!) and I picked her up from the airport, but on a sad note, Kung Fu Guy leaves today for Japan, and I also leave on Thursday for a conference in Austin, TX (where I will hopefully learn more about “Internet Marketing” and be able to create more value for you with our Kung Fu Finance website!).

This will be the very first time we have ever left the Kung Fu Kids with someone else overnight (even though it is their much-beloved Grandma)…I miss them already!

I’ve been getting a ton of great comments and questions on the blog (thank you!) and will answer as many as I can on Friday but will also try to address some as separate posts. Last week, for example, I was asked how to find private placement deals…

I’ve found them in five main ways:

1. Newsletters

By subscribing to Accredited Investor newsletters (for example, the CIA “Casey Investment Alert” service or John Mauldin’s Accredited Investor newsletter) — this is a great way to find these deals because companies looking to raise money via a Private Placement know these newsletter editors and develop relationships with them, and the editors then offer these opportunities to their subscribers.

2. Conferences

By attending Accredited Investor conferences (such as the San Francisco Rare Earths conference I attended a few months ago – the “Accredited Investor Day” was a “bonus” day at the end of the regular conference). These conferences are a GREAT way to get on “accredited investor lists” and to get invited to more and more accredited investor events where you can then be invited to participate in these Private Placements.

3. Your Broker

If you have a good full-service broker who is well-connected, he/she can inform you of Private Placement opportunities when they arise (much like the newsletter editor example above—companies develop relationships with brokers and then brokers offer the opportunities to their best clients). For example, in the resource sector, Sprott/GRI offers these to their accredited investor brokerage clients, and I’m sure other brokers in other sectors do as well.

4. Hedge Funds

The presentation I went to on Prophecy Coal was organized by a local hedge fund, 49 North, here in San Francisco. Many times these hedge funds, even if they don’t invest in the company themselves, will facilitate the meetings between the companies looking to raise money and the accredited/institutional investors because they know all of the players involved and it builds good will for their fund.

5. Other Investors

Through other accredited investors — it really is true that “who you know” is as important as “what you know”! I was added to the hedge fund email list by an investor-friend of mine whom I met at a previous accredited investor conference…you might be hearing more from him soon on Kung Fu Finance (I’m trying to talk him into doing a guest post…). 🙂

Basically, once you attend one or two accredited investor conferences, or subscribe to an accredited investor newsletter, or talk with other accredited investors, etc., you will find these deals.

These companies are definitely not trying to hide; on the contrary they are actively looking for money!

So my advice is to simply get involved — talk to your broker and let them know you’re interested in these deals, search on “accredited investor presentation”, etc. in your local area and see what you can find, subscribe to some newsletters, and basically get the word out that you are looking for and are interested in participating in these deals….

Good luck!

To your financial success,

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