Regulation A+, a promising enclave within the JOBS Act that enables private companies to perform a lightweight IPO and raise up to $50MM from average investors and not just wealthy ones, went live exactly four months ago today.
FundPaaS, a funding platform as a service and prominent FinTech company located in San Francisco, executed against this new law to launch the first Reg A+ “Portal as a Service” for Broker Dealers, Legal Firms and Crowdfunding Portals last month, and most recently has gained additional momentum from early adopters and new core integrations to 3rd party services to strengthen it’s position as the one-stop shop for Reg A+ deals. The new services include automated bad actor checks, Rule 255 compliance for investor communications, a flat fee 3rd party escrow service; events reporting and SEC form filings via partnerships and vendor integrations. A technical example is its Bad Actor API, which will be externalized later this week so that any industry participant, including a self-issuer, can run this and comply with the ‘no bad actor’ rule associated with Reg A, Reg D, intrastate offerings and Title III Crowdfunding when it goes live.
In a Regulation A+ offering, the issuer can offer and sell its securities directly to the public, or can choose to hire a licensed broker-dealer to help sell the securities. FundPaaS is already powering some Reg A+ deals by providing a non-transactional “shares reservation system” in the form of a web plugin for issuers (without an intermediary) to test the waters before qualifying an offering with the SEC. It has also developed a new rules engine to comply with investor limits and to orchestrate the various steps along the way, which include placeholders for custom offering memorandums, subscription agreements and disclaimers. A deep integration with a clearing broker dealer and registered transfer agent is also part as of its foundation to enable stock transfers of Reg A+ offerings.
What’s next on the list?
Since Reg A+ issuers are expected to file audited financial statements pre and post-offering, FundPaaS is currently working on a Financial Audit & Regulatory Reporting API which will also help its Title III product and enable key data to transfer, via XML integration with EDGAR, to prepare parts of Form 1-A. FundPaaS is actively searching for strong Broker Dealer and Securities Attorneys to partner and complete its ecosystem. You can reach them directly via firstname.lastname@example.org