pGroup Privacy Housing
We are a start-up seeking venture capital. This site covers the business basics for potential investors. We have filed a non provisional business method patent application. This site explains what we do without disclosing the intellectual property.
Most people can’t borrow money to make a significant investment. Credit, income and down payment requirements for investment loans are simply out of reach to most people.
The only way most people can borrow money to make a significant investment is with single family mortgages. Our patent pending business method enables people to use single family mortgages to invest in commercial real estate.
Our method enables a couple earning as little as $15/hour each, or an individual earning 58K, to borrow 300K to invest in commercial real estate. They just need a 600 credit score-and little or no money down. Our method also gives the new investors significant competitive advantages over current commercial investors-including lower interest rates, longer repayment terms, more cash flow and protection against defaults.
People aged 62 or older can borrow 50% to invest up to 700K in commercial real estate and never make an interest or principle payment-ever. This investment opportunity gives people aged 62 and older about three times the return of a fixed annuity with virtually no risk of default-and no financial penalty for dying early.
What we do:
1. Identify appropriate properties and apply our patent pending business method that enables single family mortgage financing of commercial properties.
2. Promote the investment opportunity to modest income people and people aged 62 and older.
3. Facilitate the sale between the current owner, the finance company and the new investors.
4. Charge an 8% fee on the gross sale with 3.75 % of the gross sale in expenses, netting 4.25%. Our average project will gross around $13 million. We exceed 1 billion in revenue with 77 projects (1.5 projects per state).
We need funds to cover expenses and to provide the seller earnest money while we apply our business method and facilitate the sale to the new investors. The amount of earnest money will likely be 2-10% of the sale price; however, until we have a proven track record, we will likely need to purchase the property. Short term property loans offer 70-90% leverage.
Below we forecast return on invested capital with 5 & 10% earnest money, plus 3.75% of the gross sale to cover expenses. We are assuming a 6 month time frame to complete the transaction. After the first project in each market, we expect to reduce the time frame to four months by having a waiting list of qualified buyers. All projections are before taxes.
1. We charge an 8% fee, with 3.75% in expenses, netting 4.25%.
2. With 10% earnest money plus 3.75% for expenses, 13.75% total, our 6 month ROIC is 61.82% (4.25 net divided by 13.75 invested = 30.91×2 (6 month investment) = 61.82).
3. With 5% earnest money plus 3.75% for expenses, 8.75% total, our 6 month ROIC is 97.14% (4.25 net divided by 8.75 invested = 48.57×2 (6 month investment) = 97.14).
4. A four month turn-around instead of 6 months improves ROIC by 50%. Reducing the earnest money below 5% - possibly as low as 2% - dramatically improves ROIC.
Investment & Exit:
We expect to be profitable with our first project. We hope to work with just one VC to fund earnest money and expenses for several projects in several cities. After we reach your funding limit, we plan to raise real estate investment capital. Our strong returns will allow for an attractive exit multiple while we meet our goal of remaining a private company.