What is the difference between a private placement and a public offering?

A private placement is sold without SEC registration in reliance on an exemption, typically to a limited or qualified group of investors, while a public offering is registered with the SEC and generally available to the public. Most early-stage and closely held companies raise capital through private placements.

Do I need an offering memorandum for every capital raise?

Not necessarily: smaller, closely negotiated raises sometimes proceed with just a subscription agreement and term sheet, while larger or broader offerings often warrant a formal memorandum describing the business and risks. The right approach depends on the offering's size and audience.

What if my investors are located in different states?

Offerings involving investors across multiple states may trigger notice-filing requirements in those states in addition to Florida and should be reviewed on a state-by-state basis before the raise closes.

Can I advertise my capital raise publicly?

It depends on which securities exemption the offering relies on. Some exemptions permit general solicitation and advertising under specific conditions; others prohibit it entirely. This should be confirmed before any public marketing of the raise.

What ongoing obligations do I have after closing a capital raise?

These depend on the transaction documents but commonly include periodic financial reporting to investors, maintaining accurate capitalization records and honoring any negotiated consent or pro rata rights in future financings.

Capital Raising Attorney | Florida Private Offerings

Structuring and documenting capital raises across multiple investors and closings.

Coordinating a raise across multiple investors

A capital raise involving several investors requires a consistent framework (the same instrument, the same disclosures and the same compliance posture applied across every investor) so that no single closing creates inconsistency or exposure for the others.

Offering structure and disclosure

Depending on the raise's size and audience, companies may prepare an offering memorandum or private placement memorandum describing the business, the offering terms and the risks, alongside the subscription agreement each investor signs. Even where no formal memorandum is used, the company's disclosures to investors should be accurate and complete.

Multi-jurisdictional considerations

Investors located in different U.S. states may trigger notice-filing obligations in those states beyond Florida.
Foreign investors add source-of-funds documentation and, potentially, additional compliance considerations.
General solicitation restrictions vary depending on which federal exemption the offering relies on.

After the raise closes

Ongoing obligations can include periodic reporting to investors as agreed in the transaction documents, maintaining accurate capitalization records and tracking any conditions tied to future financings or investor consent rights.

Process

1
Structure the offering
Determine the applicable exemption, investor eligibility requirements and disclosure approach.
2
Prepare documents
Draft the offering memorandum, if used and the subscription agreements.
3
Manage closings
Coordinate investor closings consistently, tracking required filings for each.
4
Maintain compliance
Complete Form D and any state notice filings, and maintain investor records going forward.

Answers

Frequently asked questions

What is the difference between a private placement and a public offering?: A private placement is sold without SEC registration in reliance on an exemption, typically to a limited or qualified group of investors, while a public offering is registered with the SEC and generally available to the public. Most early-stage and closely held companies raise capital through private placements.
Do I need an offering memorandum for every capital raise?: Not necessarily: smaller, closely negotiated raises sometimes proceed with just a subscription agreement and term sheet, while larger or broader offerings often warrant a formal memorandum describing the business and risks. The right approach depends on the offering's size and audience.
What if my investors are located in different states?: Offerings involving investors across multiple states may trigger notice-filing requirements in those states in addition to Florida and should be reviewed on a state-by-state basis before the raise closes.
Can I advertise my capital raise publicly?: It depends on which securities exemption the offering relies on. Some exemptions permit general solicitation and advertising under specific conditions; others prohibit it entirely. This should be confirmed before any public marketing of the raise.
What ongoing obligations do I have after closing a capital raise?: These depend on the transaction documents but commonly include periodic financial reporting to investors, maintaining accurate capitalization records and honoring any negotiated consent or pro rata rights in future financings.

Official sources

Consult the official sources above for current rules and procedures.

Capital Raising Transactions