FREQUENTLY ASKED QUESTIONS
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Q: What does WealthForge do?
A: WealthForge is a financial technology company that is changing the way capital is raised. We work with issuers and offering sponsors of unregistered securities, both public and private, to help them raise capital efficiently and compliantly. Additionally, we work with financial advisors and family offices to help source and execute investments in WealthForge administered private offerings. We also work with other broker-dealers to form selling groups, syndicate offerings and provide efficient technology solutions to enable their unregistered securities business. You can learn more about WealthForge on our About page.
Q: How long has WealthForge been in business?
A: WealthForge was founded in 2009 by Mat Dellorso and Fred Bryant while at the University of Richmond. Mat and Fred saw the need for greater transparency and efficiency in raising private capital and investing in alternative investments, specifically private placements. In 2012, WealthForge Securities, LLC became a member of FINRA as a first-of-its-kind broker-dealer focused on compliance services for online private placements. Since our founding, WealthForge has grown to a team of over 30 employees, supporting dozens of clients with their capital markets technology and compliance needs and we have been recognized by UBS, Benzinga, and Steve Case, among others, for our innovative approach.
Q: Is WealthForge hiring?
A: We are regularly looking for hard working and innovative people to join our fast-growing team. Current job listings can be found on our Careers page.
Q: What types of companies does WealthForge work with?
A: WealthForge specializes in helping growth stage operating companies and private funds raise capital. Recent offerings include opportunities in Real Estate, Technology, Energy, HealthCare, Consumer Products, Litigation Finance, Life Settlements, 1031 Exchanges/DSTs and more.
Q: What offering types/exemptions does the WealthForge platform support?
A: WealthForge currently supports offerings utilizing the Reg D 506(b) and 506(c) as well as Reg A (Reg A+) exemptions.
Q: What is the difference between the various offering types you support?
Q: Are there any industries or offering types that WealthForge will not consider?
A: Yes, WealthForge is not currently working with companies in the cannabis/marijuana industry, offerings that include EB-5 investors, and capital raises relying on blockchain technology, such as ICOs.
Q: Does WealthForge specialize in a particular industry?
A: Many of the offerings on our platform are real estate offerings, but we have also worked with offerings in other industries including technology, healthcare, energy, and litigation finance.
Q: What type of marketing does WealthForge do for my deal? How many investors will see my offering?
A: WealthForge does not market administered offerings to individual investors. However, we do market select opportunities to financial advisors who are members of the WealthForge Network.
Q: What is the WealthForge Network?
A: WealthForge provides a showcase of available vetted investment opportunities to financial advisors to streamline the process of research and diligence. Advisors who opt-in to the Network will receive new offering notifications and updates on the capital raises as they progress. Currently there are several hundred financial advisors that can access and review those select offerings on the WealthForge platform and may choose to recommend investment opportunities to their clients.
Q: Will my investors be kept private or will WealthForge present other deals to them?
A: Your investor information will be kept completely private and secure. We present deals only to advisors who have opted-in to our Network, never to individual investors.
Q: Will I need to get a third party diligence report to work with the network?
A: No, but a third party diligence report helps advisors and broker-dealers diligence your opportunity for their clients.
Q: How much money has been invested through the network?
A: Network advisors have invested approximately $10 million in client assets into offerings hosted on our platform.
Q: Why should I work with a broker-dealer?
A: A broker-dealer is a registered intermediary in the business of selling securities and administering compliance best practices within the self regulatory organization of FINRA (Financial Industry Regulatory Authority) and the SEC (Securities Exchange Commission). We believe the best way to mitigate risk is to conduct a capital raise through a registered firm.
Q: What makes WealthForge different from crowdfunding portals?
A: Crowdfunding portals, such as WeFunder, StartEngine and SeedInvest, primarily deal with offerings utilizing the Reg CF exemption, or offerings that are available to non-accredited investors. They may also work with Reg D and Reg A offerings, but most of the investors are retail or from the “crowd”, meaning they are from the general public. While we also offer solutions for Reg A offerings, WealthForge is different because of our specialization in Reg D offerings and our Network of financial advisors. Reg D offerings are not available to non-accredited investors and therefore are not an ideal fit for a public online portal. Our platform offers issuers a streamlined process for investors to subscribe online through the issuer’s existing website and to process their investors with increased efficiency. This creates a better investor experience than the traditional method and comes with the benefit of the compliance oversight of a registered broker-dealer.
Q: Does WealthForge prepare offering documents?
A: No, although we do work with many lawyers and law firms that have expertise in writing offering documents and we would be happy to refer you to them.
Q: Can we use WealthForge’s compliance and technology services "a la carte"?
A: WealthForge offers its Invest Button technology, compliance and network services to those clients who sign a Master Service Agreement. Currently, there is no option to just use our technology or network as separate individual services.
Q: Do you work with firms that are just debt?
A: Yes, WealthForge works with issuers who sell debt securities.
Q: How many funds have you worked with?
A: As of January 2018, WealthForge has completed more than 300 securities offerings for an aggregate total capital raised amount exceeding $500M.
Q: What are the requirements for the diligence process?
A: All issuers will need to provide substantive material information on their business including, but not limited to, formation documentation, background and bad actor checks on officers and directors, financial information, business plans, use of proceeds, and more. We provide new issuers with a checklist of documents we will be requesting and reviewing.
Q: How long does the diligence process usually take?
A: WealthForge usually conducts new client onboarding and due diligence for an issuer’s first offering within 2-4 weeks. Subsequent offerings from repeat sponsors usually happen more quickly.
Q: What happens if I fail your diligence process?
A: WealthForge is very thorough in the diligence process and devotes significant time and resources to offering review. We will provide comments and written feedback on delinquencies, however no refunds will be given on engagement fees.
Q: Who will help guide me through the process?
A: We will provide a dedicated client services manager who will help you navigate the diligence process and answer any questions you have along the way. Often, the client services manager will engage other compliance analysts and associates to ensure that you get a complete and well thought out answer to any question.
Q: Do I need to register as a broker-dealer and/or have registered representatives?
A: Potentially. SEC and FINRA rules require registration if any compensation is paid tied to the successful sale of a security or in certain other circumstances. Please see our e-book on broker registration for more details.
Q: How do I know if I qualify for the issuer exemption?
A: It is best to consult legal counsel as WealthForge does not provide legal advice. For more information on the issuer exemption, you can read our whitepaper.
Q: Does WealthForge support 3(c)1 and 3(c)7 funds?
A: Yes. WealthForge works with issuers with single asset offerings via SPVs, with operating companies selling stock into a C-Corp or membership units into an LLC, and Issuers of Limited Partnerships and Qualified Purchaser funds.
Q: What about 1031 Exchanges and DSTs?
A: Yes. WealthForge acts as a managing broker-dealer and has several registered representatives that are experts in 1031 exchanges and structuring Delaware Statutory Trusts. If you would like to know more about 1031 exchanges, including investor preferences, diversification potential, tax advantages, and how the 2018 tax reforms affect 1031 exchanges, download our whitepaper.
Q: What is the difference between the Invest Button and the Dynamic Tombstone?
A: The Invest Button provides a navigation link for easy access to WealthForge's white-labeled investment workflow for investors to make an investment and subscribe to your securities offering. The Dynamic Tombstone provides an easy-to-implement presentation layer (with an image, summary details about your offering, and marketing materials) to the Invest Button's navigation link.
Q: What products or services does WealthForge offer to Advisors?
A: WealthForge aims to highlight private investment opportunities to registered investment advisors for their client's investment consideration. WealthForge Securities, LLC, a registered broker-dealer, completes due diligence on these offerings and makes them available to our Network via email and our offering showcase. Advisors who opt-in to the Network will receive new offering notifications and updates on the capital raises as they progress. Currently there are several hundred financial advisors opted-in to review investment opportunities. For access to our offering showcase please fill out the Network Request form here.
Q: How much money has been invested through the network?
A: So far Network advisors have invested approximately $10 million in client assets into offerings on our platform.
Q: How should I charge my clients for recommending private offerings administered by WealthForge?
A: Some of our offerings are available to be held at custodial platforms like TD, Fidelity, and Schwab. Some can be held at other firms like Millenium Trust or Pensco Trust. Advisors often charge for alternative assets under management or a consulting fee.
Q: How does ongoing reporting / K1s work?
A: WealthForge does not administer reporting services. Issuers communicate directly with investors and advisors after primary sale of securities. These communication schedules vary, however many communicate on a quarterly or annual basis including through the dissemination of K1s and performance updates.