I’ve heard it multiple times now, from angel investors and entrepreneurs alike, that the JOBS Act changed the definition of “accredited investor” in order to make it easier to be one. (Remember, Dodd-Frank made it harder.) It’s as if President Obama and the Congress had with the JOBS Act done away with the many flaming hoops that investors and companies have had to jump through for decades in order to raise capital in compliance with the securities laws. Continue reading →
All posts tagged JOBS Act
The SEC has finally issued proposed rules that would eliminate the prohibition against general solicitation and advertising in Rule 506 offerings. The proposed rules are good news for startups because they offer broader access to investment capital sources, and the SEC should be applauded for its reasoned and reasonable approach in the new rules.
There was a lot of handwringing and blog ink spilled over what the SEC might do with Section 201 of the Jumpstart Our Business Startups Act (the “JOBS Act”). Recall that the JOBS Act directed the SEC to amend Rule 506 of Regulation D to permit general solicitation or general advertising in offerings made under Rule 506, provided that all purchasers of the securities were accredited investors. Section 201 of the JOBS Act went on to require that the SEC’s rules require the issuer to take reasonable steps to verify that the purchasers of the securities were accredited investors, using such methods as determined by the SEC.
I have highlighted some of the most significant quotes and points from SEC Release No. 33-9354 below. Continue reading →
As we wrote last week, the most exciting provisions of the JOBS Act, at least for private companies–the repeal of the ban on general solicitation in all accredited offerings and crowdfunding–are not yet effective and won’t be effective until the SEC issues new regulations. On the same day we published that post, the Securities and Exchange Commission (SEC) issued a notice reminding everyone that crowdfunding is still unlawful until the SEC adopts new rules implementing the JOBS Act’s crowdfunding exemption.
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