iDisclose is a new business providing private placement memorandum (PPM) preparation services through a web-based application for enterprises raising money, especially through (broadly defined) crowdfunding sites. In other words, iDisclose is bringing the offering memorandum into the 21st century.
Co-Founder Doug Ellenoff is one of the industry’s leading legal voices. The iDisclose platform is designed for all the different players in the entrepreneurial capital raising marketplace: the entrepreneurs or issuers, the investors, the platforms and the lawyers.
Doug explains, “iDisclose places the job of disclosure back into the hands of the entrepreneur (who is in the best position to provide all of the necessary details). Rather than provide un-contextualized information about a business to a lawyer, and then relying on the lawyer to prepare the first draft, the entrepreneur responds to an interactive online dialogue to identify the relevant disclosure issues and organizes the information into a legal document that requires limited attorney review.”
Of course, investors are the consumers of the product. Doug notes that if investors are reviewing multiple PPMs, the standardized format provides investors with easier “apples to apples comparison.”
For the platforms, he says, “iDisclose allows platforms to offer a value-added service to their users and standardizes the disclosure format across the entire platform. This allows the platform to create a vibrant marketplace of lowering the cost of capital for businesses, reducing risks to investors, and protecting the businesses seeking capital.”
Finally, Doug says, the lawyers have an easier time of it as well, allowing them to spend more time providing valuable legal advice and review and less time with tedious drafting.
On Thursday, October 1, 2015 at 2:00 Eastern, Doug will join me for a live discussion about iDisclose and its benefits. Tune in here then to watch the interview live. Post questions in the comments below or tweet questions before the interview to @devindthorpe.
More about iDisclose:
WHAT IS IT:
- iDisclose is a web-based application that streamlines the legal procedure of raising capital by guiding entrepreneurs through an adaptive process to customize institutional quality disclosure documents, including Private Placement Memorandums (PPMs).
- Because the solution allows business owners to craft their own highly-accurate PPM documents, while only collaborating with their own team and attorney as needed, iDisclose actually empowers entrepreneurs to “make their own counsel”, saving them thousands of dollars in costly fees.
- Built by an award-winning team of experienced securities lawyers, iDisclose fuses cutting-edge technology with legal know-how to significantly reduce the time, money and effort traditionally exerted on the disclosure process.
WHY IS IT NEEDED:
- Simply put, business owners who need PPMs, can’t afford them.
- In certain financing transactions, entrepreneurs are required to have PPMs when raising private money for their businesses. A PPM protects business owners from investors or SEC regulators who could potentially claim that the company failed to provide adequate disclosure while fundraising.
- The challenge is…PPMs typically cost between $35,000 to $100,000 for a business owner who hires a qualified lawyer to manage the entire process, which can be very cost prohibitive, especially for a startup operation.
- The good news is…with iDisclose a PPMs only cost $5000, which is roughly an 80% savings when compared to the standard cost of these documents.
Douglas Ellenoff serves as the co-founder of iDisclose, an adaptive web-based application that enables entrepreneurs to prepare customized institutional grade private placement documents for a fraction of the time and cost. A highly esteemed corporate and securities attorney for more than two decades, Doug also serves as founding partner of Ellenoff, Grossman & Schole, a finance law firm known as a leader in crowdfunding, where he has facilitated several billion dollars in transactions for dozens of broker-dealers, investor groups and small businesses. As one of the world’s most prominent figures in crowdfunding, Doug was a key player in the implementation of JOBS Act regulations. A sought after speaker and media source on innovative capital formation, Doug is passionate about placing high quality legal disclosure within any businesses’ reach.