First, is the company raising money a broker-dealer? Second, what is the minimum amount of investment per investor? Third, does the company raising the money have access (or a rolodex) of a significant number of high net worth individuals?
The book is necessary because they will be pitching it to high net worth individuals (who will sign a statement saying they have a minimum net worth of $1 million). But these are not typically, professional investors. They're typically just ordinary folks who have amassed a little nest egg and are looking for a "homerun" with some of their funds. The company will not be working for nothing. And the $40,000 quote for the book will be for their time and legal expense to prepare it. Therefore, they will be charging you a fee (in addition to the cost of the book) for their fund-raising efforts. Typically, this will be in the 2.5-10% range. So, you could end up netting less than $440,000 of the $500,000.
Second, if the minimum investment is, say, $25,000, that means that you will have up to 20 investors. It also means that the company may have to talk to more than 200 (about a 10% hit rate is not unusual) to get that. That will a fair amount of time, since each investor has to get the book, read it and then talk to the company rep. And if the minimum investment is lower (which for $500,000 it may be) the odds and timing increase further.
Long and the short of it, is that if this appears to be your only option and the funds are essential right now, you may have no choice. But if not, try to find a better solution (more capital, fewer investors who are professionals)
Hope this helps.