CROWDFUNDING
are funding portals allowed to provide investment advice?
NO
JOBS Act 2012
"Jumpstart our business" directs the SEC to create rules exempting crowdfunding from the securuites registration laws
income or networth less than 100k,
.limited to 2000 or 5% of the lesser of your income or networth
Limit on capital raised
1million per year via internet
2008 crowdfunding
Hurricane Katrina
Broker dealers and funding portals that are registered w/ SEC and FINRA
are permitted to offer and sell securities on behalf of issuers to the investing public using
through crowdfunding, pp; able to invest in entrepreneurial starts via
broker dealer or funding portal
may 2016
companies can use crowdfunding to offer and sell securities to the investing public
if greater than 100k
invest up to 10% of annual income or networth, cannot exceed 100k
Cautions
must meet SEC rules if they ask for investments immediately small business = higher risk info limited to whats on funding portal
Crowdfunding
online money-raising strategy that begins as a way for the public to donate small amounts of money to charities
original crowdfunding in US
statue of liberty grover cleavland would not fund it
Definition of Crowdfunding
the act of outsourcing tasks, traditionally performed by an employee/ contractor to an undefined large group of people or community, through an open call
Funding portal
website, platform that advertises investment opportunities and facilitates the payment from investor to issuer