The short answer for some investors is yes, in the form of investment in private offerings made by Alaska-grown businesses. Private offerings are not for the short-term or unsophisticated investor. They are by nature high-risk ventures and should be considered only by persons who have experience in investing in, or who can hire persons to advise them on investing in, the ventures.

However, private offerings in Alaska companies can have advantages not shared with investments outside of Alaska.

Let's be sure about defining a private of-fering of an equity or debt investment before we consider possible advantages and disadvantages of each. Equity investments include such things as offers of common stock, or options to acquire that stock, in a corporation. They also include units in a limited partnership or member units in a limited liability company.

Debt investments include of-fers of preferred stock in a corporation or promissory notes issued by a corporation, limited partnership or limited liability company.

Under Alaska and federal law, all of these equity or debt investments are securities. Generally, an offer of a security under that law requires registration of the offering before the offer and sale of the investment may be made by the issuer, with limited exception.

However, these exemptions do not exempt the issuer from the disclosure requirements of that law. The specific disclosure requirements may vary from state to state and between state and federal law. The nature of the requirements is typically to require the disclosure of all material facts related to the offering of the securities.

Generally a private offering is one accomplished without general solicitation. That is, the company making the offering does not make use of public advertising, general meetings with groups of prospective investors, or public announcements of the offering. Typically, the company must have a prior business relationship with the prospective investor.

Regulation of security offerings under Alaska law is accomplished through the Alaska Securities Act. Whether an offer of a security is registered under that act or exempt from registration under one or more of its provisions, the offering company must comply with the act's disclosure requirements. Similarly, the company must separately comply with the disclosure requirements under federal securities law.

Why consider local investment?

Now, why might an Alaskan seeking equity or debt investments consider a private offering made by an Alaska company? There are several reasons to consider, but here are just a few: