Advice needed! Going public

[Goldman snacks]

I have been managing, renovating, doing work on property for some businessmen for the past half a year or so, I know them, We have a good relationship, and I always pull through and help them find ways to save/make more money on their ventures.

From negotiating prices and making tough descisions for them and more.

They have a new development and the go ahead funding for a multimillion project to build an apartment building, they have told me that they want to take their holding company and go public with it in Africa as there's less regulations and red tape, they want me to be the CEO of the company for them, wich sounds like a good prospect for me.

I know a lot about the business , but not a lot about public companies and more specifically the legal side. I feel like they don't want their name on it because they have a bad past (their previous public company got caught up a pump and dump scheme) and that is understandable as I will help the company look like a better prosepect and won't turn away investors.

My concern is that my name is on the company and I don't want to set myself up in a bad position. We have lawyers and everything that will be with us, something still makes me feel like I'm missing something here.

If anyone has had a public company before or knows about this area please help me out or just throw in your two pence.

 

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[Niptuck MD]

hopefully when you go public you have a strong (small cohesive) board of directors to follow the overall goal and plans (yours) and you have a viable exit strategy if you do believe it is a "pump and dump" situation

reputation awareness and maintenance is vital in real estate these days

 

[Envision]

wtf

Someone who has a reputation for schemes wants to take their sketchy deal public in Africa because of less red tape and they're miraculously asking you to be the CEO?

Sandeep in India also thinks there is a virus on your computer and you definitely should give him your credit card number so he can help fix it.

 

[Raoul Duke]

I have been managing, renovating, doing work on property for some businessmen for the past half a year or so, I know them, We have a good relationship, and I always pull through and help them find ways to save/make more money on their ventures.

From negotiating prices and making tough descisions for them and more.

They have a new development and the go ahead funding for a multimillion project to build an apartment building, they have told me that they want to take their holding company and go public with it in Africa as there's less regulations and red tape, they want me to be the CEO of the company for them, wich sounds like a good prospect for me.

I know a lot about the business , but not a lot about public companies and more specifically the legal side. I feel like they don't want their name on it because they have a bad past (their previous public company got caught up a pump and dump scheme) and that is understandable as I will help the company look like a better prosepect and won't turn away investors.

My concern is that my name is on the company and I don't want to set myself up in a bad position. We have lawyers and everything that will be with us, something still makes me feel like I'm missing something here.

If anyone has had a public company before or knows about this area please help me out or just throw in your two pence.

 

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[GuestUser155]

Seems like you weren't included during the scheming process.

Don't know why you'd accept this position.

 

[Waspy]

You like prison food?

 

[Andy Black]

"How you do anything is how you do everything."

They've already shown the way they think.

 

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[fhs8]

They have a new development and the go ahead funding for a multimillion project to build an apartment building, they have told me that they want to take their holding company and go public with it in Africa as there's less regulations and red tape, they want me to be the CEO of the company for them, wich sounds like a good prospect for me.
...
I feel like they don't want their name on it because they have a bad past (their previous public company got caught up a pump and dump scheme)

Their previous company got involved in a pump and dump scheme and now they want someone else to fall.

This video sums it up perfectly.

 

[Dougema]

Run for the freaking hills!

 

[Scot]

This will sound like tough love but..

Ask yourself, do you feel that the work you've done thus far in real estate qualifies you to be the CEO of a company?

If you can't say 100% yes, you may be the fall man.

 

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[Goldman snacks]

This will sound like tough love but..

Ask yourself, do you feel that the work you've done thus far in real estate qualifies you to be the CEO of a company?

If you can't say 100% yes, you may be the fall man.

Thanks for the replies and African themed banter. I knew at least 50% of the replys would just be people saying it's a scam.

The holding company only has around 6 million in assets over 2/3 buildings so I can definitely manage it and basically already do.

They were upfront about the whole pump and dump thing since I first met them and they told me all about it and I read the case online. They didn't make money last time doing it and it cost them.

I have around 100k and I want to buy a large multi family soon myself, so I believe doing this will help me secure loans and meet the right people as they are well connected with politicians and large businessmen.

Also surely to 'fall' for them I would have to do something illegal. And if I'm CEO, then surely it would be up to me whether I wanted to break the law or not.

I see where everyone is coming from and it is a risk, however if it's done right surely it's a win win as I will also be making a lot of money.

if I do go ahead, I will be doing all my homework and doing everything by the book or I will exit the company for sure.

 

[Insaint]

Also surely to 'fall' for them I would have to do something illegal. And if I'm CEO, then surely it would be up to me whether I wanted to break the law or not.

Just because you will be the CEO does not mean you will know everything that is going on in the company. There are so many things they can do to screw you, creative bookkeeping, keeping things off the books or even simply cleaning out all accounts. How are you going to prevent any of that? Keep in mind that the lawyers you mentioned work for the owners, not you.

Also, even if they don't do anything illegal it can still come back to haunt you. If they do something sketchy (but legal) and a lot of investors lose their money, guess whose name is going to show up in the papers/on the internet. That's right, yours. Good luck with any future business when the first thing people see when they google your name is lawsuits and terrible press.

Please reconsider because this has the potential to wreck your life. Unfortunately it sounds like you have already made up your mind, so good luck.

 

[MJ DeMarco]

I feel like they don't want their name on it because they have a bad past (their previous public company got caught up a pump and dump scheme) and that is understandable as I will help the company look like a better prosepect and won't turn away investors.

Oh, so they've had their "Jesus" moment and changed their ways? Ya sure?

The fact that they want to go public AGAIN is suspicious. That's like someone convicted of mortgage fraud who now wants to start a new mortgage business -- and gee whiz, they want you to head the firm. Where do I sign?

Keep in mind...

The people you hitch your wagon to can take your wagon into places you never expected, nor intended.

 

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[RHL]

I have been managing, renovating, doing work on property for some businessmen for the past half a year or so

Unless by "property" you mean a huge collection of hotels in multiple geographic areas with hundreds of staff, you're probably not CEO material. This is the way that pied pipers always charm sidewalkers: They dangle the impossible carrot. Consider the lotto. "You could never make $100,000,000 on your own. It's pointless to even try! But if you give me just $20/week, maybe, someday, you could win it. There is no other way."

From 2-week cellulite-to-six-pack transformations, to overnight millionaire schemes, if the dream is wild enough, somebody always falls for it.

Don't let it be you. It sounds like you've got real work already. Grow what you know, don't get rope-a-doped into some illicit scheme. You don't want to go to prison in Africa.

 

[G-Man]

Also surely to 'fall' for them I would have to do something illegal. And if I'm CEO, then surely it would be up to me whether I wanted to break the law or not.

This statement alone tells me you're not ready to be a CEO.

Here's what's about to happen: You're going to turn this down and use your hard earned capital for something you have control over, and in approximately 18 months you're going to hear about some poor schmuck going to jail after these two clowns had investors wire money to a rathole account in Sierra Leone and jump on a plane to Abu Dhabi.

 

[Goldman snacks]

I am on the fence about this, the main thing I'm worried about is my reputation for future deals and the fact it's in Africa.

The company is very small and is going to be just around 50 aptartments in a llc holding company. The 'get rich quick' kind of thing is not how this is as I have done a lot and I am good at what I do.

I trust the people as I spend a lot of time with them. If this was In America I wouldn't even be questioning it, but like you said I don't want to go to African prison or anything like that.

As we are very close, I am not worried about them running off, I believe I would be 'in' on what ever they have planned, but I don't want to get in too deep and 'ruin my life'.

I am going to talk to them more about it yet as this is not even planned to happen for another 3-4 months

 

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[Dougema]

I think you already made your decision. Good luck with it! Just use the skepticism shown here from experienced people( mine not included) to make yourself aware and extra-careful in this endeavor.

Again, best of luck to you, hope it all works out great!

 

[vinylawesome]

So if you're Phillip Green who's going to be Ace Rothstein?

 

[Goldman snacks]

So if you're Phillip Green who's going to be Ace Rothstein?

I had to google the names, I haven't seen the film so I don't really understand. I have decided that I want to sit down and meet everyone that would be involved in the slightest, I want to know my job responsibilities and salary etc and if i am still on the fence then I will have to find a way to keep the relationship but not help them on this one.

 

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[Waspy]

I had to google the names, I haven't seen the film so I don't really understand. I have decided that I want to sit down and meet everyone that would be involved in the slightest, I want to know my job responsibilities and salary etc and if i am still on the fence then I will have to find a way to keep the relationship but not help them on this one.

Your job responsibilities?

You are CEO. Your responsibilities are the safe and legal running of this business.

If it's such a small company, as you say it is, why do they even want to go public? The paperwork alone doesn't seem worth it for a company of that size, unless they have something sketchy planned.

 

[Goldman snacks]

Your job responsibilities?

You are CEO. Your responsibilities are the safe and legal running of this business.

If it's such a small company, as you say it is, why do they even want to go public? The paperwork alone doesn't seem worth it for a company of that size, unless they have something sketchy planned.

Yes I know what a CEO does however I want them to describe in detail what exactly they want me to do day to day.

There are lots of public real estate holding companies and I guess it is one way of financing their business.

 

[G-Man]

A long time ago a saw a tv special about famous confidence schemes. Something one of the experts said stuck with me: "It's not that the victims don't see the warning signs. They do. A basic human fear is the fear of missing out on a big opportunity. This is why these schemes always work. People are so afraid of missing an opportunity that they are willing to rationalize away all the warning signs."

Might be something to think about. Not trying to be high and mighty here, either. I've lost 5 figures myself because I rationalized away warning signs....

 

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[G_Alexander]

(their previous public company got caught up a pump and dump scheme) and that is understandable as I will help the company look like a better prosepect and won't turn away investors.

Run.

Sincerely,
Former Merrill Lynch Investment Banker