“June 19 marks the beginning of a new era for small business capital formation. Any company willing to spend $100,000 or so, including fees to prepare audited financial statements, will have the opportunity to sell securities to the general public under this new regulation – allowing a private company to complete a “Mini IPO” and operate as a public company at a much reduced cost, both in terms of management time and dollars. The real challenge will be finding investors willing to invest in these companies. Many are expected to attempt an IPO without the assistance of a broker or investment banker, relying on Internet solicitation and social media – the large majority of these companies going it alone will face a difficult time achieving their funding goals – especially those with little or no track record.
However, for those companies who are uncertain as to whether there will be sufficient investor interest to justify the time and expense of filing a Regulation A+ offering with the SEC, they will now be able to “test the waters” – publicly solicit non-binding indications of interest, before making any filings with the SEC.
And perhaps most exciting: statistically a large percentage of IPO offering proceeds is immediately put to use for new hires – a huge benefit to this country’s economy that no one can quarrel with.”
Watch Sam at Crowdfunding USA 2015 at National Press Club, Washington DC
Samuel S. Guzik
Guzik & Associates
1875 Century Park East, Suite 700
Los Angeles, CA 90067