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Published byShanon Johnson Modified over 9 years ago
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Crowdfunding Professor Bohle Students: Vincent Naidoo, Yvonne Tan, Timothy Dang
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Agenda Review financial disclosure proposals Review parties involved in equity crowdfunding transaction Lesson: Title IV/Regulation A+
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Equity Crowdfunding The transaction between investor and issuer Exchange securities for capital Expected Return on Investment
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SEC’s Financial Disclosure Proposal Issuers offering $100,000 or less Issuers offering more than $100,000, but not more than $500,000 Issuers offering more than $500,000
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Texas’s Proposal and SEC’s Proposal Require no audited financials No annual filing requirements Non-accredited investors can contribute up to $5,000
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Issuer Includes any person who is a director or partner of the issuer that offers or sells securities in a crowdfunding exempt offering Could also be principal executive officer(s), principal financial officer and controller accounting officer of the issuer
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Intermediaries Crowdfunding Platforms Title III of the JOBS Act requires that crowdfunding transactions take place through an SEC-registered intermediary Broker-dealer or a Funding Portal Provide investors with educational materials on how the offering process works and the risks involved with investing in crowdfunding securities.
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Investors Accredited Bank Insurance company Individual with income > $200,000 Joint income with spouse > $300,000 Non-Accredited Investor that does not meet the net worth requirements for an accredited investor.
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Equity Crowdfunding Title IV of the JOBS Act Enables smaller companies to sell up to $50 million of securities Regulation A+ (formerly A) now allows non-accredited investors Provides an effective way of raising capital while protecting investors
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Equity Crowdfunding Regulation A+ Tier 1 – for offerings up to $20 million Tier 2 – for offerings up to $50 million Requirement to provide audited financial statements Limits non-accredited investors to 10% of annual income or net worth
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