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Re: 1jas post# 61919

Wednesday, 07/03/2024 11:56:54 AM

Wednesday, July 03, 2024 11:56:54 AM

Post# of 62906
SEC Form D and Private Placements
Regulation D governs private placements of securities. A private placement is a capital-raising event that involves the sale of securities to a relatively small number of select investors. These investors are often accredited and can include large banks, mutual funds, insurance companies, pension funds, family offices, hedge funds, and high and ultra-high net worth individuals. As these investors usually have significant resources and experience, standards and requirements for a private placement are often minimal, in contrast with a public issue.

In a public issue or traditional IPO, the issuer (private company going public) collaborates with an investment bank or underwriting firm. This firm or syndicate of firms helps determine what type of security to issue (e.g., common and/or preferred shares), the number of shares to issue, the best offering price for the shares, and the perfect time to bring the deal to market. As traditional IPOs are often purchased by institutional investors (who then are able to allocate portions of shares to retail investors), it is critical that such public issuances provide thorough information to help less experienced investors fully understand the potential risks and rewards of partially owning the company.
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