Step 1: From the Project Summary, select the desired entity:
Step 2: From the Class Summary page, select the 3-dots on the upper right-hand side of the page under the Project Actions button. Select Edit Classes from the drop-down menu. Note: You can also navigate to the desired class first. From the 3-dot-menu, you will see the option to Edit Class:
Step 3: Add or edit the Class Details:
- Entity Ownership Type: How the ownership of the deal is referred to. IMS defaults to Percentage as this is the most common option. Please refer to your Operating Agreement to be sure when setting up your class(es) for the first time.
- Equity Class Name: Add your class name. You may update this at any time.
- Type of Equity: Update the type of equity for a particular class. IMS Default is 'Equity'.
- Ownership of Entity: How much of the entity the class owns.
If you only have one Class, this will be 100%. If there are multiple classes, input the relevant class percentages. Ownership must tie out to 100% or you will not be able to proceed with the class creation/edit.
- Target Amount: This is the goal amount for your raise.
- When entering a closed deal, you will have this information already. For an investing deal where you are actively raising capital, enter the anticipated target amount.
- Minimum/Maximum Payment: The minimum and maximum investment amount that you will allow from any one investor for that particular class offering. Note: This is only for setting up sales offerings on the Investor Portal.
- Preferred Return: This is the investor interest rate for the class.
- If the deal pays a preferred return, input the rate in this field. If your deal does not pay a preferred return, you may leave this at 0%.
- Shares: When you have shares, the ownership is dictated by the shares for the class with respect to the total number of shares
- Ex: If you have 105 shares in Class A and 95 shares in Class B, the ownership percentages would be Class A: 52.5% (105/200), Class B: 47.5% (95/200)
- Offering Price (Shares Only): This is the price per share. (# of Shares x Offering Price = Target Amount)
- Ex: If you have 10 shares in a class and the offering price is 25, the target amount should be $250
- Estimated Internal Rate of Return: If you have an estimated IRR that you'd like to be able to show your investors, you can enter it here.
- Accreditation Method:
- None: The investor accreditation method is disabled for all investment workflows.
Self Accreditation: Default option for all new classes. If this is chosen, the investor will attest to their accreditation status if you choose the Investor Portal investment experience, however, it is up to the Sponsor to determine and verify an investor’s accreditation.
Verify Investor: This will route the investor to a 3rd party verification system (VerifyInvestor) that will require the investor to upload supporting documentation to determine accreditation status. The investor will be sent a link in the confirmation summary email after they have completed the investment process.
- Self + Verify Investor: The investor will not only attest to their accreditation status on the Investor Portal (if chosen), but they will also receive a VerifyInvestor link in the confirmation summary email after they have completed the investment process.
- Is this a private class: Selecting this box ensures that the portal offering is only available to investors who are manually selected and added to the list. Note: All existing investment profiles and newly created investment profiles will also have access to the private raise if the added individual is properly connected to those profiles in the CRM.
- View Advanced Options:
- Residual Value: If you wish to show your investors the residual value, enter it here.
- Estimated Equity Multiple: If you have an estimated equity multiple you wish to show your investors, enter it here.
- Distribution Frequency: Choose your distribution frequency. This drives the Next Distribution Date metric.
- Add/Delete Class: You'll notice two options to the left of the Class Details fields:
- 'Add Additional Class' - Selecting blue text allows you to add an additional class. Note all class ownership percentages must add up to 100%
- Trash can icon - This allows you to delete a class. Keep in mind that there must be at least one class for investors to invest in, and all class ownership percentages must add up to 100%
Note: When deleting a class with data associated with that class (investments, documents, distributions, etc.), you will receive a prompt to acknowledge that all applicable items will also be deleted. Please be aware that the process of deleting is permanent. The class(es) and associated details may take a few minutes to delete. You will receive an email when the process is complete. Select Delete. Select Next (if applicable), and then select Save.
After entering all of the applicable information, select Next.
Step 4: Here, you will have the ability to see a summary view of all investors in that class (or classes). Note the option to use the right arrow (>) to select specific investors, or use the Expand All button to see all investment details for all investors. You can make modifications to the additional investment details (Class, Investment Amount, Shares/Ownership, Date, Status). If you need to make any changes to the previous page, select Back and Next when finished. Once you are satisfied with the summary, Select Save.
When moving investments from one class to another:
- Confirm that the receiving class has the capacity for the Equity and the Ownership of the investment that is being moved over. If the target amount, for example, is not high enough to accommodate the investment that is being moved, then it needs to be increased first. Example below:
- Original: Class A - $1,000,000 - 90% / Class B - $100 - 10%
- Updated: Class A - $750,000 - 67.5% / Class B - $250,100 - 32.5%
- If your changes cannot be accommodated from the move, the class investment totals and ownership/shares will turn from black to red text. You will not be able to save your updates until the proper changes have been made to accommodate the incoming investments.