The U.S. Securities and Exchange Commission is implementing a rule that relaxes restrictions on crowdfunding through next February, according to a Federal Register notice published today. The net result of the temporary rule is to accelerate the timeline for a company to access capital through crowdfunding, at the expense of some public access and investor information.
The U.S. Securities and Exchange Commission (SEC) recently proposed rule changes that aim to make fundraising easier for new companies, including by expanding crowdfunding’s applicability and allowing for “demo day” communications. The changes target three particular methods of exemptions: Regulation A, Rule 504 of Regulation D, and Regulation Crowdfunding.
A Securities Exchange Commission (SEC) report contains over 20 recommendations for the SEC to consider that would improve small business capital formation. The report, released in April, stems from the 36th annual Government-Business Forum on Small Business Capital Formation – a daylong event held late last year.
A Securities Exchange Commission (SEC) report contains over 20 recommendations for the SEC to consider that would improve small business capital formation. The report, released in April, stems from the 36th annual Government-Business Forum on Small Business Capital Formation – a daylong event held late last year. Its recommendations include issues related to the definition of accredited investors; rules changes that would increase the number of Regulation A+ and Regulation Crowdfunding offerings; and, a revised regulatory regime (based upon the European regulatory regime) to improve peer-to-peer lending.
On April 5, 2012, President Obama signed Jumpstart Our Business Startups Act (JOBS Act) into law with the intent of helping small businesses and startups raise capital through several changes to long-standing securities regulations, including a change that would allow companies to raise equity from both accredited and non-accredited investors through a publicly solicited crowdfunding campaign (Title III of the Jobs Act).
Last week, the Securities and Exchange Commission adopted final rules to update and expand Regulation A, an existing exemption from registration for smaller issuers of securities. The new Regulation A+ will enable smaller companies to offer and sell up to $50 million of securities in a 12-month period, subject to eligibility, disclosure and reporting requirements. Under Regulation A+, there are two tiers of offerings that companies may make that include:
On October 25, 2013, the Securities and Exchange Commission (SEC) voted unanimously to propose rules under the JOBS Act that would permit companies to offer and sell securities to non-accredited investors through crowdfunding intermediary portals (crowdfunding portals). The SEC released a fact sheet that highlights several of the proposed rules for startups and investors who want to engage in crowdfunding that include:
On November 15, the Securities Exchange Commission (SEC) will host the "SEC Government-Business Forum on Small Business Capital Formation," an annual forum focused on the capital formation concerns of small business. This year's agenda will focus on the implementation of the Jumpstart Our Business Startups Act (JOBS Act), specifically equity-based crowdfunding regulation. The forum also will look at issues related to capital for small business that were not addressed by the JOBS Act.
The Securities and Exchange Commission (SEC) announced its first proposed rule that will help make equity-based crowdfunding a reality. The proposed rule (Rule 506) will allow for the general solicitation and general advertising of securities. At this point, however, the rule will only apply to accredited investors — an individual with income of more than $200,000 per year or a net worth of over $1 million dollars, excluding the value of the investor's primary residence.