[nitsuaeekcm]

You can’t join unless you’re an accredited investor. That’s because, like for many other fun similar things, the enterprise passes the Howey Test and is considered a security under the Securities Act of 1933.

It’s funny how they try to disclose-away the problem at the bottom, even though they’re obviously worried about it enough to block retail investors (if a security only sells to accredited investors, you can basically do whatever you want.)

https://www.uclalawreview.org/here-comes-the-sun-how-securit...

[throwaway2037]

This is an excellent point! I found the disclaimer at bottom of home page:

  No offers to sell or solicitations of an offer to buy securities or any other type of investment are being made or solicited by Legends Incorporated at this time.

More details here: https://www.legends.solar/legal/legal

I am very familiar with the Howey Test. From time to time, HN try to "hack" the Howey Test with various mental gymnastics, but always fail.

Real question: Could Legends Solar structure the investment like Cadence Real Estate? (Not a shill for them!) Cadence is basically mortgage-backed securities on multi-family properties for retail / mass affluent. They are operating for more than 10 years now. If their legal structure was not sound, I assume they would be enforced upon by SEC & friends.

I feel "direct green energy investment" for retail / mass affluent investors has huge untapped potential -- like 10s of billions of USD, maybe 100s. It makes me so frustrated that I cannot push ahead solar and wind projects with my own money. I want to transition power supply as fast as possible. Oh yeah, please add utility-sized battery installations to that list also. When I look at solar potential in India (see "Bhadla Solar Park"), it boggles my mind. There is SO much potential. Same for Middle East, North Africa, and Australia. All could use/export the electricity or convert water to hydrogen, then use/export.

[yepnopemaybe]

The exact legal and financial structuring is still in progress. We will likely use a structure similar to that used by Reg A+ crowdfunding platforms like Masterworks.io. In fact, I've been in regular contact with their GC to validate this. There are other structures we could use, as well.

[yepnopemaybe]

My plan is to keep things simple, to answer your other question. As little abstraction and structured securitization as possible. We want it to be as close to a one-for-one analogy for true direct equity ownership in an actual panel as we can make it.

[miketery]

This one is easier to get around Howey test if done right. But I can't tell from the site whether they'll do it this way.

As a buyer the key is to provide direct ownership of the panel, and a contract where I pay for a service to install / upkeep the panels, and a contract to sell electricity. In this case I am buying an asset, and my profits don't depend on greater or less input by the company.

The Howey test is: "a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party."

The key for this service is that my profit is not tied to the efforts of the 3rd party, it's tied to weather, and electricity prices.

Now they may structure it, such that it is a common enterprise, in that case it will pass the Howey test, and be a security. However if they sell the asset, and include a service agreement, then it doesn't pass the test.

Edit: as an example, when you buy crypto miners from Compass, and pay them monthly to host them for you. Compass is not selling a security, they are selling as asset that generates revenue, but profit is not tied to the effort of the 3rd party.

Edit2: Nevermind their site uses language like 7.3% return, shares, and cash dividend, so indeed it's a security and passes the Howey test.

[yepnopemaybe]

We are currently working with accredited investors, but we are working to launch a product for retail investors. Recent changes in crowdfunding regulation, Reg A+ in particular, make our lives a bit easier, and we have some very committed finance partners working to structure a financial product that will be appealing to retail investors.

[JetAlone]

>Solar panels with serious levels of energy output are a substantial up-front investment.

>There may be lots of not-rich people who want to make smaller investments.

>So, let's chop them up into smaller segments to decrease that up-front cost!

>Oops, now it's a security, so you have to be rich in the first place to invest.

Talk about a Catch-22. Thanks, Roosevelt.

[yepnopemaybe]

Solar panels are fairly simple and inexpensive to install, relative to other energy sources. Best of all, they can be scaled to on-site demand since there is not a large upfront cost.

I would not say that is the problem we are solving. The problem as I see it is that most people have no idea what they actually own through their investment. We make it simple to know through great design and communication, that carries through from the financial structuring to the UI/UX, we are doing it all custom from the ground up.

We start with solar because its a pretty safe investment and people love it.

[JetAlone]

My frustration comes partially due to some of my personal circumstances:

-Filthy unlanded tech scribe peasant.

-Have some savings, it is time to invest, but I don't have hundreds of thousands.

-Cannot afford land close enough to where I live (Tokyo) to fruitfully manage it.

-Due to legal reasons, there is a language barrier to the better ones among more accessible investment platforms I have found I can use.

I would love to be able to invest something like a couple thousand dollars in an endeavour such as Legends Solar. I would like to get into a real investment of some sort. Ideally without prohibitive amounts of red tape.

Thank you for your response.