Education

“REG CF” An Analysis of the First 50 Crowdfunding Offerings

By Marc A. Leaf, Robert T. Esposito, and Abigail Luhn, The Securities and Exchange Commission (SEC) is now accepting Form C filings from private companies seeking to sell securities through registered crowdfunding portals. We have been following the nascent crowdfunding space closely and will continue to monitor the adoption of crowdfunding as a new method of financing private companies. In this alert, we will analyze offerings conducted through crowdfunding portals, offer tips for those thinking of entering the space, and provide a summary of the SEC’s final rules and forms for equity crowdfunding (“Regulation Crowdfunding”). The Drinker Biddle Crowdfunding Report, an open data set providing…

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Is Real Estate Crowdfunding Offers An Attractive Alternative For Secure Investments?

By Yemani Mason Founder at VestMunity.com, Crowdfund Beat Guest post, Over the past several years, home prices have been on the rise – particularly in South Florida. According to the Sun-Sentinel, “In South Florida, median home prices have been on the upswing in recent years and rose modestly in April.” Additionally, more and more people are moving to Miami, adding to an already active real estate market.Realestatearama reports that, “South Florida’s tax environment (no state income tax in Florida), growing tech industry and infrastructure improvements are leading more Americans to relocate to Miami…The trend of Americans moving to Miami is going to continue.” Still, many people may…

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The Equity Crowdfunding Paradox

By Jorge Sanchez III Partner, Nouvantage.com, Crowdfund Beat Guest Contributor, Crowdfunding is a broad classification used to categorize a variety of modern digital funding activities aimed at engaging wide networks of people. In this article I will refer to the equity crowdfunding of venture capital. Investing is a risk-taking endeavor where return on investment is the premium harvested by investors for allocating funds to a venture executing a business plan and confronting the risk of failure and loss of capital. The uncertainty of the outcome that the business pursues gives rise to the primary barrier to investment, information asymmetry. Investment decisions are information driven and based…

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“The Fix Crowdfunding Act”

BY Lauren Leibowitz, Principal at 1st BridgeHouse Securities, LLC, Crowdfund Beat Sr. contributing editor, The Evolving Crowdfunding Regulations: Now Presenting “The Fix Crowdfunding Act” On April 5, 2012 the JOBS Act was passed. On October 30, 2015 Title III: Equity Crowdfunding final rules were passed which marked all 7 Titles of the JOBS Act were approved. Recently, the ‘‘Fix Crowdfunding  Act’’ was  introduced to Congress to improve Regulation Crowdfunding.  FINRA and SEC has taken an approach of letting the crowdfunding industry cultivate the business model and the regulators will oversee and implement regulations on an as needed basis. The integration of technology within the private capital markets is…

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REPORT: Is Marketplace lending A temporary phenomenon?

Crowdfund Beat Data Center: Deloitte Report MPLs are online platforms that enable investors to lend to retail and commercial borrowers. Unlike banks, MPLs do not take deposits or lend themselves; as such they do not take any risk onto their balance sheets. They make money from fees and commissions received from borrowers and lenders. The rise of Marketplace lending has urged many commentators to highlight the potential disruption that such new business models may bring to traditional banking. Our research presents a different opinion and instead concludes that MPLs do not currently have the competitive advantage needed to threaten this traditional banking model. However, while…

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SEC’s Guidance On Advertising By “REG CF Title III”Issuers

SEC’s Guidance On Advertising By “REG CF Title III”Issuers

By Mark Roderick Shareholder, Flaster/Greenberg P.C. CrowdFund Beat ‘s  Sr.Guest Editor. The SEC just provided guidance for Title III issuers in the form of Compliance and Disclosure Interpretations. You can read the CD&I’s themselves here. Before Filing Before filing Form C (the disclosure document used in Title III) and being listed on a Funding Portal, a Title III issuer may not take any action that would “condition the public mind or arouse public interest in the issuer or in its securities.” That means: No Demo Days No email blasts or social media posts about the offering No meetings with possible investors After Filing Once a Title III…

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New CrowdFunding Rules are a Game Changer

By Joel Block CEO at Bullseye Capital MarketPlace Partners, LLC , CrowdFund Beat Guest Post, This was an historic week in the securities industry. Rules that have been in place for more than 80 years were smashed and replaced with new, modern rules that allow citizens from every walk of life to invest in start-up companies right on the Internet. In the past, private placements had to be kept private which effectively meant that you had to be a millionaire to get into a private placement and make any money. Nothing seems more un-American than having to be a millionaire to make money in the United States…

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Growth of Real Estate Crowdfunding in 2016

By Waleed Esbaitah, CEO of the Middle East-based real estate crowdfunding platform,Durise and CrowdfundBeat Guest Editor, Real estate crowdfunding has recently emerged as an extremely lucrative investment opportunity for a large number of real estate investors. Massolution, a research and advisory firm estimates that the global market for investments in property through this route was $2.5 billion in 2015 and is conservatively expected to touch $3.5 billion in 2016. Why is real estate crowdfunding such an attractive mode of investment? The answer is simple – it allows individual investors to buy into a real estate opportunity for a relatively small amount of money (as low as…

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IRA Services Launches P2P Lending’s First Cloud-based API Driven Retirement Investment Solution

CrowdFund Beat News Wire,           San Carlos, CA — (April 6, 2016) – IRA Services, the leading provider in custodial trust solutions for non-exchange traded investing, is pleased to announce that it will be unveiling the ISCP™, the first and only real-time cloud-based API driven retirement investment solution for the P2P industry, at LendIt 2016, the world’s largest conference connecting the global online lending community taking place on April 11-12 at the San Francisco Marriott Marquis. The ISCP ™ allows real-time access to over $12 trillion dollars of capital for the P2P industry by providing platform investors with the ability to effortlessly fund…

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Crowdfunding – Important Do’s and Don’ts

By Kaelynn Bailee, CrowdFund Beat Guest Post, It is common to entrepreneurs seeking crowdfunding. Crowdfunding sites turn product ideas into reality or services. It has become a new way to finance projects and startups. When few years ago, you could not start a business or get a product without resorting to traditional financing channels, today there are many projects that have been supported financially by a mass of users, thanks to platforms like Kick starter or Indiegogo. But success in this field is not based solely on having a good proposal; everything that surrounds this proposal has to be well targeted.        …

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Secondary trading of securities – risks & exemptions

 By Scott Purcell CEO FundAmerica Technologies, LLC The good news is that under Reg A (and 506b&c), securities offerings by an issuer are exempt from state blue-sky registration. This is fantastic as it means that each one of the 51 “mini-SEC’s” don’t have to get involved prior to starting your fundraise. Sure, the “sale” of those securities may be subject to state dealer registration, especially for serial issuers or anyone using general solicitation aspects of Reg A or 506(c), but that’s different than having to fully qualify the offering via Blue Sky review. The bad news is that secondary sales (in other words, when an…

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Donald Trump & Rule 506(d) bad actor

Lauren Leibowitz, Principal at 1st BridgeHouse Securities, LLC, CrowdfundBeat Sr. Guest editor, On July 10, 2013, the Securities and Exchange Commission adopted bad actor disqualification provisions for Rule 506 of Regulation D under the Securities Act of 1933, to implement Section 926 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The disqualification and related disclosure provisions appear as paragraphs (d) and (e) of Rule 506 of Regulation D.           As a result of Rule 506(d) bad actor disqualification, an offering is disqualified from relying on Rule 506(b) and 506(c) of Regulation D if the issuer or any other person covered by…

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HEADLINE NEWS

BBB Tip of the Week: Giving to crowdfunding sitesThe Spokesman-ReviewThere is a good chance if you are on social media or have an email account that you have been sent a link to a crowdfunding site to support an individual or organization. GoFundMe.com, YouCaring.com, Kickstarter.com [...]

messenger-inquirerLaw change could boost state crowdfunding lawsmessenger-inquirerVideoscore owner Darryl Ingram decided to seek Wisconsin investors through a process called state crowdfunding, a relatively new and underused tool available to small businesses. What he didn't real [...]

NanalyzeSelf Crowdfunding and the Failure of PlastcNanalyzeDeath is a sad thing when if befalls the people around us, and there are 5 stages of grief that people go through when they are mourning the loss of a loved one. There is now a 6th stage of grief that seems to have appeared la [...]

Madison.comLaw change could boost little-used state crowdfunding lawsMadison.comDarryl Ingram of Racine founded a consulting business, Videoscore, that helps high school athletes connect with college teams. He hopes relaxed federal rules for state crowdfunding makes it easier for entr [...]

PR Newswire (press release)Vodi's Crowdfunding Round Reaches More Than $60,000 Raised in ...PR Newswire (press release)The next-generation mobile messaging app eclipses its first fundraising milestone with more than 70 investors on the WeFunder platform.and more » [...]

Daily MailCrowdfunding for 'off-road wheelchair' for Luke WoodDaily MailA student left in a wheelchair and unable to communicate after a horrific car crash is trying to crowdfund £15,000 to buy a 'life-changing' wheelchair that will let him leave his rural home whe [...]

Black EnterpriseWomen Are Crowdfunding Their Maternity Leave in DrovesBlack EnterpriseWith only three states (California, New Jersey, and Rhode Island) mandating paid family leave, expecting parents are turning to crowdsourcing platforms to fund maternity and paternity leave after the [...]

Mitchell Chapman: Crowdfunding proves to be no panaceaBerkshire Eagle (subscription)PITTSFIELD — Since the establishment of crowdfunding sites such as GoFundMe, Kickstarter, and Patreon, individuals and teams on the internet have been able to subvert traditional means of publishing an [...]

NewsOK.comVideo: Crowdfunding campaign launched on behalf of Jimmy LaFave, who has rare terminal cancerNewsOK.comRed dirt music pioneer Jimmy LaFave, who came of age in Stillwater and went on to become an Austin, Texas, music icon, has been diagnosed with a rare form of terminal cance [...]

MetroMP crowdfunding election campaign raises thousandsMetroJess Phillips, who represents Birmingham Yardley, asked people 'to 'give as little or as much as you can' to help her retain her seat in June's general election. She claimed that elections in her constitue [...]

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