Do I Need a PPM Lawyer? What a Private Placement Attorney Does, Costs and Will Not Do

By Joel Arberman, founder of Prepared to Raise · 17 companies taken public, 30+ private placements prepared · Published November 8, 2026

What a PPM lawyer actually does

• Confirms the exemption. Rule 506(b), 506(c), Regulation Crowdfunding or Regulation A, based on who your investors are and how you will reach them. This decides whether a PPM is legally required at all.
• Drafts the private placement memorandum. The disclosure document: description of the business, the securities and their terms, use of proceeds, management, capitalization, risk factors, conflicts, tax considerations and how to subscribe. The risk factors section is where experienced counsel earns the fee, because it is your protection under the anti-fraud rules.
• Drafts the transaction documents. Subscription agreement, investor questionnaire (which documents accredited status under 506(b)), and amendments to your operating agreement, bylaws or shareholder agreement so the new securities exist and their rights are defined.
• Handles filings. Form D with the SEC within 15 days of the first sale, and blue-sky notice filings in each state where an investor lives, with the fees and deadlines that go with them.
• Reviews what you say. A good securities lawyer reads the deck and executive summary against the PPM so nothing in the marketing contradicts the disclosure.

When you need the PPM, and when you need only the lawyer

Under Rule 506(b), if even one investor is not accredited, you must give that investor specified written disclosure before the sale, which in practice means a PPM with financial statements. For accredited-only raises under 506(b) or 506(c), no particular document is required, but the anti-fraud rules apply to every statement you make, so most lawyers recommend a disclosure document in larger raises and at least a formal risk-factor section in smaller ones. How much a PPM costs and whether you need one goes deeper on that decision.

Either way, you still need the lawyer for the subscription agreement, the governing-document changes and the filings. "No PPM" does not mean "no securities counsel."

What a private placement attorney costs

Fees depend on the firm, the complexity of your structure and how prepared you are when you arrive. Rough ranges for a US private company:

• Subscription documents, governing-document amendments and filings only, for an accredited-only raise with simple terms: often $3,500 to $10,000.
• Full PPM plus the above, for a standard 506(b) or 506(c) equity or LLC-unit offering: commonly $7,500 to $25,000.
• Complex offerings, with preferred classes, multiple entities, real estate or fund structures, or an advertised 506(c) with verification procedures: $25,000 to $50,000 and up.
• Ongoing items: state filing fees (typically a few hundred dollars per state), Form D amendments, and hourly time for investor-specific questions.

Get a fixed quote in writing, with the deliverables listed. Many securities lawyers will quote a flat fee for a standard package and bill hourly only for changes you request.

What the lawyer will not do

This is the part founders most often misunderstand. A PPM lawyer makes the offering compliant. They generally do not:

• Decide how much you should raise or whether the amount makes sense.
• Build or check your financial model, or produce the projections that go in the PPM.
• Set or defend your valuation or the terms you offer.
• Write the investor deck or executive summary, or make the story persuasive.
• Tell you which investors to approach, in what order, or what to say to them.
• Find investors. That would make them a broker.

The PPM describes a business and a deal that you have to bring them. If you bring a vague plan, you get an expensive document describing a vague plan. Do I need a lawyer to raise money, and what will the lawyer not do covers this split in more detail.

How to cut the legal bill without cutting corners

1. Arrive with the business decided. Amount, use of funds, investor pool, instrument, minimum investment and target close date in a one-page memo. Every open question becomes billable back-and-forth.
2. Bring finished numbers. Clean historical financials and a model with the projections and assumptions. The lawyer will not build them, and drafting around missing numbers wastes hours.
3. Bring the deck and executive summary. The PPM's business description is largely drawn from them, and the lawyer can check consistency once rather than redrafting twice.
4. Have the risks listed. You know your business risks better than counsel does. A founder-written list of 20 to 30 specific risks becomes a stronger risk-factor section at lower cost than boilerplate.
5. Fix the cap table first. Undocumented promises and old handshake equity are the most common source of surprise legal fees. How to fix an undocumented investment.
6. Ask for a flat fee and a scope. Then stay inside it.

How to choose a PPM lawyer

• They practice securities law, not general business law. Regulation D is a specialty; the corporate lawyer who formed your LLC is usually the wrong person.
• They have done offerings for operating businesses your size, not only venture financings or real estate funds.
• They quote a flat fee for the standard package.
• They are willing to review your marketing materials against the PPM.
• They are clear that they do not provide investors and are not paid on the raise.

Prepared to Raise clients arrive at counsel with the strategy, model, materials and risk list already done; the document package with legal review is part of our fixed-fee engagements, and a PPM is a $5,000 add-on where the raise calls for one. How that compares to hiring a securities lawyer alone.

Related questions

Can I write my own PPM from a template?

You can, and some founders do for small accredited-only raises, but the risk factors and the securities terms are where templates fail. Because the PPM is your defense under anti-fraud rules, a template that misses a material risk protects nobody. At minimum have a securities lawyer review it.

Is a PPM lawyer the same as a securities lawyer?

A PPM lawyer is a securities lawyer who drafts private placement memoranda. Any lawyer handling your private offering should be a securities practitioner; "PPM lawyer" is just the way founders search for one.

How long does it take a lawyer to prepare a PPM?

Two to four weeks for a standard offering once they have your business description, numbers, terms and risk list. Longer if those are still being decided while drafting.

Do I need a PPM for a friends-and-family round?

If any investor is not accredited and you are relying on Rule 506(b), you must give that investor disclosure that in practice means a PPM with financial statements. For an all-accredited round, a PPM is optional but the subscription documents and filings are not. See whether there is a friends-and-family exemption; there is not.

Where to start

Decide whether you need the memorandum at all with how much a PPM costs and when it is required, then follow the 90-day preparation plan so you arrive at counsel with the business side finished. If you are unsure which exemption you are in, start with which exemption should I use.

This article is general information for founders, not legal, tax or investment advice. Securities rules depend on your facts; confirm your plan with a securities lawyer before you accept money.