1. What is SIPP?

SIPP is an Incorporated business in the state of Maryland. The business is registered as Social Innovation Partnership Program and doing business as SIPP. SIPP is a for purpose social enterprise that uses entrepreneurship to tackle social inequality through social means. SIPP creates a business model to impact human earning potential through a single brand called SIPP.

SIPP aims to increase client’s wealth by 10% over 10 Years of engagement by using their money to solve social problems without losing value to the clients. Our brand is what champions us and we do everything to maintain credibility.

2. What is SIPPC?

SIPP created a wealth building mechanism to address social need problem. The wealth building product is called SIPPC which means Self Investment Partnership Projects for Crowdfunding

3. What is the product?

SIPPC is a platform that helps socialize groups of investors. It provides educational materials, journals and fully analyzed projects to engage investors.

4. How is it different from all other investment mechanisms?

It is a platform that allows investors to function in groups with control over their choices. Although the choices are mainly the production of projects to help improve the living standards of people in the community, it nevertheless creates value to the investors and the community as a whole.

5. How do I become a part of the group?

The only way to be a part of a group is to be invited or sponsored. The sponsor must have a relationship with you. If you do not have a sponsor, you can attend one of our seminars and develop a relationship with a sponsor that may choose to sponsor you.

6. Why do I need to be sponsored?

The reason to be sponsored is because the program is designed for investors who pools investments together in a pool. It is popularly referred to as an Investment club. We promote social relationship, which means you must be comfortable to relate with and to relate to others in your group, where you are all actively deciding together to invest.

Note: Investment clubs are gaining popularity in recent years, which made the “Securities and Exchange Commission”, or the SEC, to clarify the investors basic structure and rules guiding investment clubs.

Here is the SEC's definition for investment club:

An investment club is a group of people who pool their money to make investments. Usually, investment clubs are organized as partnerships and, after the members study different investments, the group decides to buy or sell based on a majority vote of the members. Club meetings may be educational and each member may actively participate in investment decisions.

Investments clubs, therefore, can be compared to mutual funds, which are investment securities that enable investors to pool their money together into one professionally managed investment. Mutual funds can invest in stocks, bonds, cash or a combination of those assets. However, with investment clubs, the members of the club invest their own money and act as the management team. They are both manager and investor at the same time.

7. Are there any fees associated with my use of the platform and joining a group?

Yes, there are fees associated to the use of the platform, which is always subject to change.

The setup fee: $50

The minimum earnest fee (Contribution towards your portfolio): minimum $50

Monthly site maintenance fee: $15

The total fee to get setup = $115.00

8. What is a portfolio

Your portfolio is your account with SIPP. Your portfolio serves like a normal savings bank account with us. Although the savings does not yield any interest, it is still deemed money available for you to invest when the group you are a part of come to a consensus on a project of interest.

9. What happens if I chose to withdraw money from my portfolio?

Just like any investment mechanism, your portfolio funds are subject to rules termed “maturity”. If you withdraw your funds before the maturity period is over you would be assessed a fee.

No fees would be assessed if your withdrawal is from the profit you have generated within your maturity cycle. (1099 is issued)

10. What is the process of getting started?

The steps below are steps an account specialist will walk you through.

1. When a sponsor recommends you to be admitted
2. You complete a 30minutes session (SIPP Qualification process)
3. 24 hours setup (Paper work & assignment to group)
4. The SIPPC account administrator then introduce you to the group
5. You continue to make monthly contribution to your portfolio
6. Quarterly you are provided with your statement of account privately and the group is provided with a collective account statement.

11. What are the judiciary duty of SIPP to SIPPC Users?

The SIPPC users are clients of SIPP with SIPP acting as the supporting structure that supports the demands and needs of the investment clubs in SIPPC.

SIPP staff therefore offers users;

1. A legal entity to which they operate under. This way, the members are considered both clients and customers of the entity and their financial contributions follows standard accounting rules.
2. SIPP offers to function to manage the real minimum or legal limit for the investment club membership on SIPPC but one club cannot exceed 99 members.
3. SIPP operates a brokerage account on behalf of the clubs, as established by the legal structure. Rules apply to the brokerage accounts based on the maturity of funds.
4. To join the investment club, a new member will usually contribute a lump, then pay a set, established amount, such as $100, per month as established by the charter of the investment club on SIPPC. 
5. The investment club newsfeed is deemed the notice of meeting to the members, although based on the charter some are required to periodically in person with minutes posted on their group pages, such as once per month, to discuss investment opportunities, meet socially and which, if any, securities into a project should be bought or sold. 
6. All the investment club on SIPPC must have a stated investment objective or investing style written into their charter, such as value investing (people with passion for the value social investment offers) or growth investing (People wanting to subsidize their income).  Members can also set up particular screening process that securities on an investment need to meet before they qualify for investment or purchase. For example, a value strategy might require a low P/E ratio before the investment club purchases it. 

12. Is investment guaranteed?

No, no investment is guaranteed. A successful growth strategy is a long-term play.  Be sure that you select projects with products or services that you believe in and be prepared to hold them throughout both the up and down-market cycles.

Disclosure:  The information we provide as educational or as a project analysis are resources for informational purposes only.  It is being presented without consideration of the investment objectives, risk tolerance or financial circumstances of any specific investor and might not be suitable for all investors.  Past performance of a project is not indicative of future results.  Investing involves risk including the possible loss of principal.  The information we provide is not intended to, and should not, form a primary basis for any investment decision that you may make.

Always consult your own legal, tax or investment advisor before making any investment/tax/estate/financial planning considerations or decisions.

13. How are the fees and commissions of SIPP determined?

At SIPP all commission is 10% regardless of the project value (Flat fee). Our fee is on the ROI only, subscription to SIPPC and the initial setup fee. All subject to change.

Fees varies across the industry as some charge fees in the form of commissions.

We have financial advisors as partners that may charge in the form of an hourly rate, or percentage of your account value. Here are the six most common ways financial advisors charge fees.

1. 1. Percentage of assets that they manage on your behalf, typically anywhere from 1% - 2% per year. The more assets you have, the lower the fee.
   2. Commissions paid to them from financial or insurance products you buy through them.
   3. Combination of fees and commissions sometimes called "fee-based."
   4. Hourly rate.
   5. Flat fee to complete a specified project.
   6. Quarterly or annual retainer fee.

               To distinguish all the fee structure, we will make an attempt to explain one after the other

1. Percent of Account Value

It is important to understand if they are providing investment management and financial planning, or just investment management. Expect to pay a higher fee if they are providing full-service financial planning along with investment management.

You will also want to ask an advisor who charges in this way if they are fee-only or fee-based. Fee-only advisors are more likely to use low-cost funds in your account, minimizing the overall expenses you will pay. Fee-based advisors may be able to collect commissions, in addition, the percentage fee charged on assets.

Many clients like this structure as fees are debited right from accounts so no check has to be written and the fees don't have to come out of the monthly budget. And fees debited from IRAs are being paid with pre-tax dollars which can be great for those in retirement.

2. Commissions

Some of these people are good financial advisors; some are just good salespeople. Their advice can be influenced by the way they are compensated.

Commissions can take the form of a front-end sales load charged on a mutual fund, a surrender charge on an annuity or commissions may be paid directly to the advisor from the investment company, as in the case of the sale of many non-publicly traded REITs.

3. Combination of Fees and Commissions

Many advisors today can collect fees and commissions. They often use the term fee-based. It is important to understand the difference between a fee-only advisor, and a fee-based advisor. Fee-only advisors cannot collect commissions.

4. Hourly Rate

This can be a great way to pay for financial advice if you are willing to implement the advice on your own. For example, you may pay a financial advisor an hourly rate to tell you how to allocate the investments in your 401(k) plans. Then you would be responsible for actually making the changes they suggested.

Since an hourly rate is not tied to the value of investments, or generated by the purchase of any specific investment, you can feel confident you will receive objective advice.

5. Flat Fee to Complete a Specific Project

When you need a project completed, such as an initial retirement plan, it may make sense to pay a flat fee to have someone crunch the numbers, and help you understand all the moving parts that go into creating an accurate retirement plan projection.

Since a flat fee is not tied to the value of investments, or generated by the purchase of any specific investment, you can feel confident you will receive objective advice.

6. Retainer Fee

If you have a more complex situation, such as ongoing stock options to be exercised, a small business, rental properties, or a need for regular income from your investments, then you may benefit from paying for ongoing advice.

Since a retainer fee is not tied to the value of investments, or generated by the purchase of any specific investment, you can feel confident you will receive objective advice.

Benefits of Investment Clubs

Perhaps the greatest benefit of joining an investment club is education. When several investors come together to share ideas and information, there is often synergistic effect, where the sum of the parts is greater than the whole. Also, when you join an investment club, you can avoid the fees and commissions of investment advisors or stock brokers.

And of course, there's the potential that the synergy of the investment club can translate into higher returns than you could have achieved on your own.

Step 1 - Invite

Step 2 - Educate & Close (Signup)

Step 3 - Qualify for minimum contribution and terms - provide client cancelation clauses

Step 4 - Assign unique identifiers ( Get their personal information for IRS) -W9

Step 5 - Account setup - Ernest fee and funding options (bill pay, mail check, ach, wire)

Step 5 - Custodial( delivering account statement, eduction update, email notification, project discoveries, project selections, account management)

step 6 - (Account reconciliation, Account closure, Project closure signoff by all invested) 

You are not serious about your business if you have not gotten 1000 no

Note: It is a sorting business not a selling business (Dissociate yourself from the result)

Attitude: Smile always, remember that people do what their leaders do, so lead the conservation with your story.

Step 1 - Invitation (Cold Marketing) - I would not be asking to meet you in person if I can explain this to you on the phone

#Always invite, never close (Face to face meeting - Do not let anyone percieve you as a sales person)

 #1 Sincere compliment 

         - Example: I love those shoes, my wife would love those! (Smile and always make sure you add girlfriend, boyfriend, wife or husband to make sure they do not think you are hitting on them)

#2 Ask: What do you do for a living?

#3 Do you keep your income options open to earn more?

Invite

I am so sorry I have to go, I would love to share an option with you. I work with a social innovation company that I would love to discuss with you over coffee what's your number so we can set up a time to discuss?

If answer is no!

Then can I invite you to a business meeting that would help you understand how to build wealth in the most innovative way?

Step 2 - Approach

A. Live Presentation: 

Where you are today, was based on the decision you made today 3 years ago. Where you will be in the next 3 years would be based on the decision you make today

Situation: In house, one on one   Use: video presentation approach (They watch a video and you stop the video to ask if they have any question)  

Situation: Big group   Use: live presentation approach (The presentation must be detailed and requires interraction)  

    i. Situation: in house, one on one   Use: video presentation approach (They watch a video and you stop the video to ask if they have any question)  

    Step:

           Introduce them, Play the video, once the video ends

          Starter words example: Awesome right! (Big smile), what do you like the best?  [Note this question is to sort people out- Ask to qualify people]

          Next question - Do you think you have the ability to push play on the player?

Congratulate them with a handshake - "let me show you how to make money, because it is important to me. Can I count on you."

STEP 2: How to close when presenting the SIPPC concept!

What to know about closing

People have this three things in their mind while you are about to close them (Its a sorting game, do not be afraid of the "NO") A No is someone you have delivered a full presentation to

• Does it work?
• Can I do it?
• Can you help me?

Output: (It is not about you getting a sale- Doing things for others in their own best interest)

• Proof of success
• Duplicable
• Helping others to do what is in their best interest

Using the 3 F's rebuttal to counter objections as a consultant: Feel, Felt, Found

     Example I know how you FEEL, I FELT that way too, but what I FOUND out (add your story)

If it is a money issue (story - reminds me of my friend John who knew if he does not build up money he would not be able to buy in)

A state has a transfer tax of $1.50 for each $500 (or fraction of $500) of the sales price of any parcel of real estate. The transfer tax is to be paid by the seller. To calculate the transfer tax due in the sale of a 300,000 house, use the following two steps:

Value/dollar amount per taxable unit = taxable units

Taxable units x rate per unit = tax

in the example above

$300,000/$500= 600 taxable units

$1.05 x 600 = $900

The seller in this transaction must pay a transfer tax of $900 to the state

Most governments understand that the descrimination that affect housing puts an undue hardship on families and strip them of the ability to achieve and maintain a satisfying lifestyle. This article is going to explore the historical details that led to the laws that protects certain classes of citizens in the United States of America

1. 1954 The Supreme court issues a decision that rejected racial discrimination in the Brown V. Board of Education (Black and White only schools were determined to be unconstituitional)

2. 1968 The court in Jones v. Mayer held up the consititutional basis for the civil rights act of 1866 in the 13th Amendment of the US contitution which prohibits slavery. Other critical things happened this year. MLK was assasinated, Robert Kennedy, Vietnam war, Civil rights movement that led to title VIII

The 1866 law prohibits all racial discrimination in the sale or rental of publicly or privately held property, without exception, whether faciliated by real estate professional or sold or rented by the owner. where race is invovled, no exceptions apply.

There are exceptions to the rules, such that a religious housing may restrict people of other religion as long as membership to the religion is not restricted on the basis of race.

A private club that is not open to the public may restrict the occupancy of lodging to its own members as long as the lodge is not operated commercially.

Note: A real estate professional is not required to provide ethnic-diversity information to homebuyers.

1866 Civil Rights Act only applies to racial discrimination, but the 1968 also allow for Title VIII of the Civil RIghts Act to be passed now known as the "Fair Housing Act" which prohibits specific discriminatory practices throughout the real estate industry.

These specifics are:

a. Race

b. Color

c. National origin

d. Religion

e. Sex

f, Familial status, or

g. disability

Housing for Older Persona Act (HOPA) was passed in 1995 to repeal the requirements for housing intended for those age 55 or older. It still however requires that 80% of the occupied units in multi family still have anyone over the age of 55 living in them. No moneytary value is also to be allowed in damages for those who in good faith  reasonably belived that property disgnated for housing the eldrlies was exempt from familial status provisions of the Fair Housing Act. HOPA provides that the occupancy of some certain properties may be restricted to the elderlies 62 and over

Department of Housing and Urban Development HUD www.hud.gov is the place to get the up to date fair housing rules and regulations issued as advisory bulletins to secondary mortgage 

American Disability Act also offers protection for people with disabilities in the real estate field either as an employee or for accessibility.

These laws prohibits 

1. Blockbusting: An act of encouraging people to sell or rent their homes due to the entry of people of a protected class is moving into the neighborhood

2. Steering is the channeling of homeseekers to particular neighboorhoods or discouraging potential buyers from certain neighbourhoods

3. Advertisement languages: You may not use certain languages that indicates preference or limitation. No exception to this rule exists regardless of how it is stated.

4. Influence Appraisal: Race, color, religion, national origin, sex, disability and familial status are factors that may not be considered in appraisals

5. Redlining is a practice of refusing to make mortgage loans or issue insurance policies in specific areas for reasons other than the economic qualifications of the applicants.

All are enforced under the HUD in the office of fair housing and equal opportunity. HUD may also initiates its own complaints. The party to which compliant is filed may reach an agreement to remedy the violation, and further take steps to liminate and or prevent discrimination is called CONCILIATION.

If the attorney general finds that a reasonable cause exist to demonstrate a pattern in preventing people from being able to fully enjoy the rights granted by the federal fair housing laws, may file a civil actions in any federal district court. First penalty may be up to, not to exceed $50,000 and 2nd not to exceed 100, 000.

Note that FAIR HOUSING is the law.

MARIA is defined as

M : Method of Annexation

A: Adaptability of the object to the land's ordinary use

R: Relationship of the parties

I: Intent in placing the item on the land

A: Agreement of the parties

In the case of a commercial property, cases of fixtures are necesitated and refered to as TRADE FIXTURES, if removed by the tenant and the premises are returned to the original condition before the lease expires; or real property, if left behind the landlord can acquire it by ACCESSION. There cases were we encourage TRADE FIXTURES if the property would yield more return of investments for our investors.

Authored by Yemi Ajao

It’s easy for homeowners to be confused on the differences of real and personal properties. Although similar, these two legal concepts are vastly different, especially when it comes to financial value. Real property law is all about the land your home may be on. The law of real property refers to anything fixed permanently to one location on a piece of property you own. This may include the soil, trees, and any surrounding, naturally existing, elements of a property. Unlike real property law, personal property refers to any moveable part of a property falling under the categories of personal possessions, lost property, abandoned property, stolen property, furniture, equipment, vehicles, stocks, bonds, etc.

Whenever a complaint is filed about a property or there is a dispute about who possesses what on a certain property in any conflict, it often takes a professional property law attorney with years of experience to quickly sort through what a client really owns on a property and how it can benefit or harm them in their case.

Property are classified as either real or personal. Personal property, sometimes called personalty, is all the property than can be owned and that  does not fit the definition of real property. The distinction between both real and personal is that personal are moveable. Personal property is also called CHATTELS.

Characteristics of Real Properties are:

1. Scarcity

2. Improvements

3. Permanence of investment

4. Area preference

Physical characteristics of land

Property has three physical characteristics which are:

1. Immobility

2. Indestructibility

3. Uniqueness

All the nature of real estate has given rise to an equal level of laws that we have to be aware of for social investment management SIM to include

1. Contract Law

2. General Property Law

3. Agency Law

4. Real Estate License law

5. Federal, State and Local Laws and Regulations

          - Consumer protection, 

          - Environmental

          - Tax

          - Land use and zoning

          The purpose of  real estate license laws is to protect the public from fraud

Authored by Yemi Ajao

These are the list of professions that have developed in the Real Estate Community

1. Brokerage: is the process of connecting a buyer and a seller together in a real estate transaction. The person that does this is referred to as a "BROKER"

A BROKER is an individual or a business representation licensed individually or as a company to buy, sell, exchange, or lease real properties for others and to charge a fee for the services. They are required to take courses and mandated to pass a stste real estate exam. In some states all real estates licencee is a broker, but only one managing broker may hire other licensees as sales associates. We partner with broker firms like Wiechart, Taylors etc until we can serve as our real estate service broker.

2. Appraisal: is the process of determining a property value based on established methods and professional judgements. The Appraisal Institute is the largest trade association. Check www.appraisalintitute.org  We will and always use a 3rd party appraisal company to remove all current and future complexities that may be related to bidge of our fudiciary duties to our investors and our community.

3. Property Management although considered as the most lucrative is the most tedious of all the class of specialty in the real estate field. This is a person or company hired to maintain and manage property on behalf of the owners. At SIPP properties and grounds we manage the day to day  management tasks, such as finding new tenants, collecting rents, finishing and altering space for tenants, ordering repairs and generalling maintaining the properties of all our clients. You can get useful resources from www.boma.org

4. Financing: This is the business of providing the funds that make real estate transactions possible. Most transactions are financed by loans secured by mortgage or deed of trust. At SIPP we have developed a financing mechanism that can help loe to any income level finance a property through us.

We offer investors an opportunity to enageg in crowdfunding for this purpose to ensure that all social shelting needs are met.

5. Home Inspections is the profession that combines a practitioner's interest in real estate with skills and training in the construction trades. In some states the trade has been recognized for the importance it offers in the real estate profession leading to training and courseworks. There are two  trade oganizations that guides the home inspection which are www.ashi.org The American Society of Home Inspectors and  www.ashi.org The  National Association of Home Inspectors. 

These is a profession that inspect and conducts a thorough visual survey of a property structure. At SIPP property and grounds we outsource this out to 3rd party inspectors to ensure that there is no internal influence or judgement that may be considered as swaying the professional judgment of the inspectors. We work with thorough inspectors that have helped us catch several hidden issues in a property before we close. Our exit strategies are always dependent on the finding in inspections that either present us with renegotiation power that will increase the value of the propety to our investors.

6. Subdivision and Development: Subdivisioning is the dividing of  a single property into smaller parcels. Real estate includes a parcel of land and every improvements on the land with rights to the airspace and sub rights of minerals undersground. We may offer this options in the real estate profession in the future as our portfolio grows.

7. Real estate counseling: We also provided this platform to help clients choose among the various alternatives involved in purchasing, using, or investing in properties as a social investing. Our role is to furnish information needed to help make decisions.

8. Education: We offer education to both practitioners in the real estate industry and our investor pools.

9. Laywers: Our legal team serve as our property trustees. They also serve as our experts in land and real estate tax applications.

We adhere to local and state laws. We stay up to date to all laws to include

i. Federal laws

ii. State laws

iii. Administrative laws

iv. Code of Ethics adopted by NAR affiliates

We deal in this area of real estates to include:

a. Residential (Single (detached) and Multi Family (Apartments, Condominium- common space such as cooporative properties, Planned Unit Developments PUDs - special zoning, MUDs - Highrise developments use housing in urban, surburban or rural areas)

b. Commercial (office space, shopping centers, stores, theaters, hotels, and parking facilities

c. Mixed use (Dual use properties) - MUDs & PUDs

d. Industrial (Warehouses, factories, land in industrial districts, and power plants) or converted use  properties, such as into luxury lofts, factory -built housing

e. Agricultural

f. Special purpose

Loan program: (All property is valued at location- meaning that same property feature may be valued differently based on location). We offer several financing programs based on the real property classification.

Land: Air rights, Surface rights, Subsurface rights

Real estate: Land plus improvements on land

Real property: Real estate plus bundle of rights

Note that ownership is descriped as bundle of legal. 

Bundle of Rights includes 

DEEPC

D - Right to Dispose - to sell, will, transfer, or otherwise dispose of  or encumber the property

E - Right to enjoy - to use in any legal manner

E - Right to Exclude - to keep others from entering and using)

P - Right to possess

C - Right to Control -  within framework of the law

Properties are guided by laws that may not include total ownership of land (time based lease) and may include characteristics (Appurtenance) on the title such as parking, easements, water rights and other improvements, that may impact the decision in purchase and disposal of the real property.

Written by Yemi Ajao

4 Lessons We Learned as Our Property Management Company Grew

Lesson #1: Not all properties are right for every property management company.

Over the past few years, we’ve said “yes” to a few properties that we really shouldn’t have, and we’ve paid the price. We’ve always handled residential homes in the Metro Detroit area. We’re very good at that. But we were hungry, and it led us to take on a few properties that, in retrospect, we probably weren’t ready for. We tried listing and managing a couple of commercial buildings. We tried to help out a few investors who had been sold bad properties in bad areas. We even tried to handle a few properties that were distinctly outside of our normal territory, though not by all that much.

Related: 10 Unforgettable Lessons From My Loser Rental Property

The lessons came raining in. We parted ways with each of those clients; at least one of them left with our blessings and a referral to someone more appropriate to their needs. We learned that it’s better to say “no” the moment we’re asked about a management job if the property in question is entirely outside of our realm of expertise or not a good fit for our business model. That “no” might disappoint a potential or existing client in the short-term, but not nearly as much as they’ll be disappointed if we say “yes” and then turn out to be unable to meet their expectations.

Lesson #2: Not all investors are right for every property management company.

In the same vein, we learned over the past few years that some people just don’t work well with our way of doing business. Sometimes, it’s a clash of management styles. For example, we’ve consciously decoupled from a few investors who were super-involved, hands-on types who didn’t seem to want us to actually do anything to or with their property. We would discover a need for maintenance, collect bids from contractors, create a work order, send them the paperwork, not hear back for several days, and then suddenly, they’d send a late-night email proudly announcing that the work was done and that we could move forward with marketing. Or we’d get all our marketing geared up and start showing a property, only to have the owner tell us they already found a tenant.

Other times, it’s a clash of personalities. We’ve taken on several property investors from overseas, including a few from places where the local culture couldn’t get much further from the to-the-point, no-nonsense, call-it-like-you-see-it attitude that typifies Detroit. One of our overseas clients became immensely agitated when we told them point-blank that the work they had just had completed (by some independent contractor not hired by us!) was insufficient and we weren’t going to be able to market the property until we went in and fixed some bits they had out-and-out failed to address. They were upset not because of the bad news (that’s just par for the course if you’re a property investor), but because we made no effort to soften the blow and no effort to apologize for not softening the blow. Calling a spade a spade just isn’t how things are done everywhere in the world—lesson learned.

Lesson #3: Keep the manager/investor relationship uncluttered.

Detroit’s unique real estate market spawns some very interesting “entrepreneurs.” One particular ex-client of ours had acquired several properties and then sold equity in those properties to a bunch of third parties, creating a whole set of SFRs that had “hybrid owners.” This isn’t all that unusual by itself—but then he insisted on being the contact point for all of them and on delivering all communication from us to the other owners. The problem was that by inserting himself in the communication process, he created a number of delays and inefficiencies that made it all but impossible to get straight answers to simple questions in a timely fashion, let alone funds for needed repairs. There’s almost certainly a property management company out there who would love to deal with him as a client—but we’re not it.

“Clutter” in the manager/investor relationship doesn’t have to be in the form of another human being. We’ve also nearly lost a couple of clients due to a much simpler form of complication (there’s a strange turn of phrase): language. This has happened two ways—once because we had a client who simply didn’t communicate in English as effectively as they thought they did, and another time because our VAs didn’t communicate in English as effectively as we thought they did. We learned to keep our communications as simple and straightforward as possible and to never assume that our clients were doing the same thing.

Related: The Landlord’s Ultimate 34-Step Property Management Checklist

Lesson #4: A property management company divided cannot stand.

This lesson came from within. Our VAs were almost all individually hired, with only a few being referred by others who had already joined us. And while we still have regular team-building meetings so we all know each other’s names and faces, we trained each department in relative solitude. The VAs who did each job talked to the departments that were the most closely related—maintenance and inspections, inspections and marketing, marketing and leasing, leasing and accounting—but the groups that weren’t immediately in each other’s faces had almost zero idea of what one another did.

That might not sound like a big deal, but it led to a slow, pervasive apathy, because many of our people didn’t have any feeling of importance in the overall picture. That led to a kind of subtle malaise during which calls weren’t getting returned with any sense of urgency, problems that cropped up were pushed on to the next guy instead of being tackled by the first person equipped to understand them, and generally balls were dropped and cracks got slipped through.

We found a solution in the form of a full-company meeting in which literally every person described their job and which other people in the company relied on them and how it furthered the ultimate goal of maximizing owner profits. Knowing exactly who was “upstream” and “downstream” from them and how their job performance was making other people’s jobs easier or harder did a huge amount to get everyone on the same page and re-dedicated to doing their jobs with a more proactive perspective.

There are more, of course—a few years is a long time to learn—but some lessons we’re still processing, and others are awfully hard to put words to. But we look forward to sharing some more in the future. Until then, we’ll leave you with our now-company-standard salutation, one we love because it reminds us that the control is in our hands:

Make it a great day!

What lessons have you learned in your years as a property manager?

Drew Sygit

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Drew is the manager of Royal Rose Property Management, a fairly high-tech solution for Detroit Metro area property owners & investors.

The SEC’s Office of Investor Education and Advocacy is issuing this publication to answer some common questions investors ask us about investment clubs. For additional investor education tools and resources, visit Investor.gov, the SEC’s website for individual investors. 

What is an investment club?

An investment club is generally a group of people who pool their money to invest together. Club members generally study different investments and then make investment decisions together—for example, the group might buy or sell based on a member vote. Club meetings may be educational, and each member may actively help make investment decisions.

In another type of investment club, sometimes called a “self-directed investment club,” members research and select investments together, but they invest individually instead of pooling their money.

Do the SEC and/or the states regulate investment clubs?

The SEC generally does not regulate investment clubs. But since each investment club is unique, each club will need to decide if it has any registration requirements.

Membership interests in the investment club may be securities under the Securities Act of 1933 (Securities Act). If so, the SEC may regulate the offer and sale of those membership interests.

An investment club may be an investment company under the Investment Company Act of 1940 (1940 Act). If so, one or more states or the SEC may regulate that investment club.

A person who is paid for providing advice regarding the investments of the club or its members may be an investment adviser under the Investment Advisers Act of 1940 (Advisers Act) or state law. If so, one or more states or the SEC may regulate that person.  Also, if one club member is paid for selecting investments for the club or its members, that person may be an investment adviser.

State securities laws may differ from federal securities laws. To learn more about the laws in your state, call your state securities regulator. To get the telephone number for your state, visit the North American Securities Administrators Association (NASAA) website .

When does an investment club have to register the offer and sale of its membership interests with the SEC?

Since the Securities Act requires the registration of the offer and sale of most securities, the investment club must first decide if its membership interests are “securities.” Generally, a membership interest is a security if it is an “investment contract.”

Generally, a membership interest is an investment contract if members invest and expect to make a profit from the efforts of others. If every member in an investment club actively helps decide what investments to make, the membership interests in the club would probably not be considered securities. If the club has even one passive member, it may be issuing securities.

When does an investment club have to register with the SEC as an investment company?

An investment club must register with the SEC as an investment company under the 1940 Act if:

the club invests in securities;

the club issues membership interests that are securities (see above); and

the club is not able to rely on an exclusion from the definition of investment company.

For example, a “private investment company” may not need to register with the SEC. To qualify, an investment club:

must not make, nor propose to make, a public offering of its securities; and

must not have more than 100 members.

A public web site or other public communication that could be viewed as suggesting that a club is looking for new members might be considered a public offering. An attorney with experience in securities law can help the club evaluate, based on its particular facts, whether its membership interests are securities and whether the club is making a public offering of those securities.

Does a person who provides advice to an investment club have to register with the SEC?

If someone is paid for providing advice about the club’s investments, he or she may be an investment adviser. Also, if one club member (instead of all members) selects investments for the club, that person may be an investment adviser.

Unless an exemption applies, an investment adviser must register with the SEC or one or more states. Even if an investment adviser is exempt from registration, the antifraud provisions of the Advisers Act still apply.

If you have questions, don’t hesitate to contact us at help@sec.gov , our online question form, or on our toll-free investor assistance line at (800) 732-0330. 

Research regularly suggests that large numbers of investors are interested in the idea that their money could be put to use so that it has a positive impact on society and the world, as well as earning them a financial return. Barclays Bank research suggests 54 per cent of investors in the UK feel this way, while a separate Morgan Stanley study puts the figure at 71 per cent; amongst the millennial generation meanwhile, the latter research put interest levels at 84 per cent.

So what stops people putting their money where their mouths are? Just 9 per cent of UK investors have actually made social impact investments according to Barclays. In which case, a shortage of capital may be holding back commercially viable small and medium-sized enterprises that would otherwise be able to make a positive contribution to society.

In truth, there appear to be two problems. One is that investors believe impact investment necessitates the sacrifice of at least some financial return – that they’ll earn less from investments that are designed to do good. Second, impact investment is seen as a standalone asset class – rather than investors looking for equity or fixed-income assets with an impact context, they assume social impact has to be separately accessed elsewhere.

However, new research just published by the investment analysts at All Street provides yet more evidence that both those assumptions are incorrect.

For one thing, the research focuses on the member firms of the Social Stock Exchange, all of which offer publicly traded securities or have plans to issue equity or debt securities on a recognised investment exchange – they don’t represent an unfamiliar asset class in other words.

All Street has also looked at the returns generated by impact investments to date; one group of venture capital funds, for example, generated an internal rate of return of 9.5 per cent over the period studied, comfortably outstripping the broader venture capital sector. Meanwhile, funds with a social mission generated investment exits with an average internal rate of return of 33.5 per cent.

The data comes as no surprise to pioneers of social impact investment such as Martin Leuw, the founder of Growth For Good, an accelerator focused on technology businesses with a social dimension. “I have always maintained that I'm a relentless capitalist and not a tree hugger,” Leuw says. “This research is further evidence that as long as you are authentic, you can do well by doing good - I hope it will encourage more businesses to be a genuine force for good and lock in their mission to strategy.”

The data should encourage more investors to get involved too, for despite the relatively slow take-up so far, impact investment is now gathering pace. Research from Standard Life predicts the total impact investment sector will be worth $1 trillion by 2020, against $60bn today. The high-profile investments made by the likes of Mark Zuckeberg’s charitable foundation are also raising awareness of the possibilities.

In the end, however, it's the story of individual businesses making an impact everyday that provide the most inspiring narratives. Take the story of Roast Restaurant in London's Borough Market, a successful food and drink venture combining commerciality with social value.

"I’ve got to where I am against the odds, having turned around a troubled teenage upbringing in south London where I got into all sorts of trouble; whilst I made that change with the support of people around me," says Iqbal Wahhab, the entrepreneur behind the business, who also launched the award-winning Cinammon Club. "At Roast we’ve offered work experience to inmates at The Clink in Brixton Prison, some of whom have come to work for us on release."

Wahhab says the social impact element of his business has enhanced its returns rather than holding them back, encouraging custom when people find out about it. "We got loads of e-mails and social media messages saying roughly the same thing – they didn’t know Roast employed ex-offenders but now that they did, they would start coming," he adds. "That was a game-changing moment for us because it showed this kind of activity to be core commercial activity."

Link to Forbes

How Social Impact Investment Delivers Superior Returns

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How Does Real Estate Investing Work?

Real estate investing works best with a strategy, A strategy we can help create or that you can best create for yourself or your investment group.  In determining how you would like for real estate investing to work for you, it is important to first determine the results that you desire from real estate investing.  Are you looking to build wealth, transferable wealth or to create quick cash or both?  Depending upon your desired results as an individual or group of investors, you can choose a short term strategy, a long term strategy or a combination of the two.

How does SIPPC real estate investing work to make quick cash?

Quick cash can be created with a short term real estate investing strategy, which includes quick turning or flipping property.  Quick turning property (buying and selling right away) can provide big and quick cash if we buy right.  Typically, the property is put under contract at a low price and then marketed at a higher price to include a profit. The property may be sold with or without improvements depending upon the agreed strategy with the investing individual or group.  Quick turn deals can easily generate from $2K to $30K plus depending upon the deal and whether it is a wholesale or retail quick turn.

Wholesale Quick Turn
Wholesale quick turns involve finding a deal below market value and quickly selling the deal at a wholesale price.  By selling wholesale (below retail), we are giving our buyers (Can be internal), typically another investor, the opportunity to make a profit.  If we negotiate the right deal upfront and turn the deal quickly, we can make good money this way. 

Wholesaling is often a method of no, or little, money down deals. This is a way that real estate investors get around the need for financial backing for flipping houses.  Let’s say that we find a motivated seller, who is willing to sell us their house at $100K.   We put the property under contract with the seller for $100K and then find another buyer (Investor group) who wants the deal and is willing to pay $110K.  We would then assign our contract with the seller to our buyer for a fee of $10K, but since this is internal, we would only transfer asset for 10K.  Our buyer actually closes and purchases the property from the seller; and at closing we are paid or transfer a $10K assignment fee, less our fee to investor account.  This is an option or another method used to wholesale.  We can put an option on a property and then sell our option to another investor group or individual for a profit.   In fact, with assignments and options, investor groups never even have to purchase the property to make money.  

Retail Quick Turn
Retail quick turns involve finding a property well below market value and getting it market ready for retail sale.  With retail quick turns, our target buyer is a home owner rather than an investor. We may purchase a property that needs a little work, a lot of work, or possibly needs no work at all because we purchase from a motivated seller at a discount.  Once the property is ready, We market and sell it at a retail price. Always look for our property going to the market on Liquidation tab. 

How does real estate investing work to build wealth?

Wealth is created through longer term real estate investing strategies, which involves buying and holding property.  In this scenario, the investor group or groups buys a property and then rents it to a tenant or leases it to a tenant with the option to buy.

Renting

Renting involves finding a property, getting it in rent ready condition and marketing it for rent. The rental real estate investing strategy offers a number of profit opportunities.  Cash flow is created when the monthly rental income exceeds the mortgage and other expenses.  Long term wealth is created through appreciation of the property, the tenants paying down the mortgage, and tax advantages. It also serves as a property for internal rent for all other social services that we offer.

Imagine us having 10 houses paid in full and rented for $1,000 a month for a monthly cash flow of $10,000.  If the houses were only worth $100K each, we would have $1 million in assets plus a $10K per month cash flow before expenses.  This financial position can be fairly easily accomplished in each investor group's timeframe. Note the Asset per investor group with SIPPC is independent of SIPPC assets.  Some investor group buy one or two houses per year and others buy a number of houses right away.

Lease Option

Lease options are created by offering a property for lease (usually for twelve months or more) with the option to buy.    There are a number of profit centers with lease options to include income from the upfront option fee, monthly cash flow from the lease, profit from the sale when the option is exercised and tax advantages.

In conclusion, the answer to the question, “How does SIPPC real estate investing work?” really depends on how each real estate investing group wants it to work for them.  Whether your goal is to build wealth, leave the 9-5, an early retirement,  financial freedom, or quick cash, you can obtain it through SIPPC real estate investing solutions. There are numerous benefits to investing in real estate individually or as a group such as buying at a discount and creating instant equity, equity created through tenants paying down a mortgage, appreciation, cash flow, leverage and tax benefits. Determine your strategy –long term, short term or a combination of the two and make real estate investing work for you by leveraging our solutions.