Quote:
Originally Posted by Sieg
I sure this helps him sleep better at night.  |
Ah the old "disclaimer".....
Private placement investments -- are the most illiquid investments PERIOD. Thus the old 5% rule applies. In other words NEVER invest more than 5% of your investable funds in ANY ONE INVESTMENT... the reason for that is - anyone can "afford" to lose 5%.
What happens in many of these is that they hit up all their friends and family -- and people put in 25 and 50 grand.... most under 100 grand... and when it goes south -- it doesn't pay the investor to sue.
For instance... It cost me over 50 grand in attorney fees just to look over the paperwork and finances of a company that I invested in. So you have to have some funds to throw around just to see if there's anything to recover. In my case I brought suit against the companies Directors and Officers... and I was 250K in attorneys fees before the insurance company (who you're really suing - and they'll defend vigorously) settled. In my case what I really wanted was the fact that each D&O would have to disclose that they had been sued. So any other company thinking about them sitting on their board etc - would see that on their 'record' as they would have to disclose this info. They'd also have to disclose what they were sued for - and the outcome (THEY LOST). Yes -- sometimes I'm an awhole. Certain people DESERVE to have people like me bite their azz.
Sometimes failure is not the sole responsibility of the owner/operator. Sometimes there are simply outside factors that come into play. In this case - if you read his sob letter - he blames EVERYONE under the sun except himself or anything HE did -- such as investing in stuff that didn't pan out - or failure to manage overhead or failure to generate sufficient sales... or failure to maintain good customer service -- resulting in lost sales... He clearly blames COMPETITION. Well yeah -- the world is competitive. Eat or be eaten. My sense is there were MANY reasons for his failure.