Fwd: RECAP: Crowdfunding Webinar

[Vic Kimandi-Bell]

Thought you might need this info.:

---------- Forwarded message ----------
From: Victoria Bell <313te...@gmail.com>
Date: Fri, May 2, 2014 at 10:09 AM
Subject: Re: RECAP: Crowdfunding Webinar
To: Vic Kimandi-Bell <cool.detroi...@gmail.com>

pass to jay

On Wed, Apr 30, 2014 at 9:47 AM, Shumway Marshall <smar...@businessfwd.org> wrote:

Victoria -- Last week, Business Forward hosted a webinar with Pravina Raghavan from the Small Business Administration (SBA) on crowdfunding as it applies to business investment. A new crowdfunding provision created in the Jumpstart Our Business Startups Act of 2012 (JOBS Act) allows businesses to sell shares of their company to a large number of small investors without the expense and reporting requirements associated with going public. Crowdfunding is already being used for charity fundraising and to provide seed money for projects that might provide a prize or reward to investors, such as early access to a music album or tickets to a charity event. But when the JOBS Act's final provisions go into effect, retail crowdfunding, or the offer and sale of shares of private businesses to members of the general public (unaccredited investors), will also be permitted. During the webinar, the SBA explained how businesses can take advantage of the new law once the SEC’s rules are finalized. Here are the highlights: Businesses will be permitted raise up to $1 million through retail crowdfunding per year. Individuals with annual income and net worth less than $100,000 may invest up to $2,000 or 5 percent of their annual income or net worth. Individuals with income or net worth greater than $100,000 may invest up of 10 percent of either, though they are limited to $100,000 per year. Businesses that participate in crowdfunding will have to disclose information about officers and major shareholders, the company’s business plan, and financial statements from the past 12 months with audited tax returns. Crowdfunding must take place through a platform registered with the SEC. The platform must provide investors with the necessary information about the investment, provide a forum for discussing the offerings, and take other precautions to reduce potential fraud.   The proposed rule is in the final stages of the writing process and may be finalized as early as the end of 2014. Once the rule is finalized, the SEC will begin the review and accreditation process. SBA will continue to provide more guidance to small businesses througout this process. Click here to view the presentation from the call. Thank you, Shumway Shumway Marshall Digital Director Business Forward

 

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