An accredited investor is an individual or entity that meets certain financial criteria set by regulatory authorities. Generally, an individual is considered accredited if they have an annual income of at least $200,000 (or $300,000 with a spouse) for the past two years, or a net worth exceeding $1 million, excluding their primary residence. Accredited status allows participation in certain investment opportunities, including private placements and hedge funds.

Cash on Cash Return (COC) is a financial metric used in real estate investing to evaluate the annual return on investment, focusing specifically on the cash income generated by the investment property compared to the initial cash investment. It is calculated by dividing the annual pre-tax cash flow by the total cash invested.

The Capitalization Rate (Cap Rate) is a percentage that represents the expected annual return an investor can achieve from a real estate property, typically used to evaluate income-generating properties like commercial real estate. It is calculated by dividing the property's Net Operating Income (NOI) by its current market value.

Your capital, when invested in various opportunities such as real estate syndications or private placements, is typically used to fund projects, ventures, or investments. It might be used for property acquisition, development, operational costs, expansion, or other business activities, depending on the specific investment offering.

A Limited Partner (LP) is an investor in a partnership, typically in the context of real estate syndications or private equity funds. LPs contribute capital to the partnership but have limited liability and minimal involvement in the day-to-day operations or decision-making. Their exposure to financial risk is limited to the extent of their investment.

A Preferred Return, also known as a "pref," is a predetermined rate of return that certain investors, usually Limited Partners, receive before other investors, such as General Partners, start receiving their share of profits. It ensures that a specific level of return is provided to preferred investors before the remaining profits are distributed among all partners.

An Acquisition Fee is a one-time charge or fee paid to the General Partner (GP) or investment sponsor for identifying, negotiating, and closing a real estate deal or investment opportunity. This fee is often expressed as a percentage of the total property acquisition cost and is intended to compensate the GP for their efforts in bringing the opportunity to the investment partnership.

The Private Placement Memorandum (PPM) is a legal document provided to potential investors in a private investment offering, such as a real estate syndication or private equity fund. The PPM contains detailed information about the investment opportunity, including the investment strategy, risks, financial projections, terms, and relevant legal disclosures. It helps investors make informed decisions about participating in the investment.

A Private Placement refers to the offering and sale of securities to a specific group of private investors, rather than through a public securities exchange. Private placements are often used for raising capital for various projects or ventures. They may involve issuing shares, debt instruments, or other investment vehicles to a limited number of accredited investors, as defined by securities regulations. The terms of private placements are outlined in the Private Placement Memorandum (PPM).

Capital refers to financial resources, such as money or assets, that are invested in various projects, ventures, or investments. The specific use of capital depends on the context. In business, capital might be used for operational expenses, expansion, research and development, or acquiring assets. In real estate, capital could be used for property acquisition, development, renovations, or property management. The use of capital varies based on the goals and needs of the entity or project receiving the investment.

The use of your capital depends on the investment or opportunity you've chosen. If you've invested in a specific project, business, or real estate opportunity, your capital might be allocated for purposes such as financing a new product line, purchasing equipment, funding marketing campaigns, acquiring real estate properties, or supporting operational activities. The details of how your capital is being used should be outlined in the investment documentation provided by the investment sponsor or company.