Improving Legal Documents in Crowdfunding: Get Rid of the State Legends!


By Mark Roderick CrowdFunding Beat  Sr. contributing editor and crowdfunding attorney with Flaster/Greenberg PC. I see lots of offering documents like this, with pages of state “legends.” The good news is that in Crowdfunding offerings – Title II (Rule 506(c)), Title III (Regulation Crowdfunding), and Title IV (Regulation A) – you can and should get rid of them.               The legal case is pretty simple: Before 1996, states were allowed to regulate private offerings. Every state allowed exemptions, but these exemptions often required legends, differing from state to state. The National Securities Market Improvement Act of 1996 added section 18 to the Securities…

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A Reflection of Online Money Lending


By Steve Cinelli , CrowdFund Beat Sr. Editor, @stevecinelli Some many months back, in fact prior to their listings, I wrote a piece questioning the lofty valuations of the marketplace lending platforms (LC and ONDK) as they entered the public markets.  The basic thesis was recognizing the fundamental business these platforms engaged, i.e., money lending, and how others in the same space, albeit not as “technology positioned”, delivered the same product and/or service, and I thus intimated that the newbies should be valued with similar metrics to the incumbent financial institutions. In observing the platforms’ performances over the last year, as well as evolving market conditions,…

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Albright; Letter to Congressman McHenry in Support of “Fix Crowdfunding Act”


"H.R. 4855 democratizes the investing landscape by giving even the tiniest of investors the ability to access alternative growth products and build diversified retirement portfolios. While researching a white paper highlighting the monumental impact of tax-deferred micro alternative investing, we uncovered a staggering correlation between America’s retirement system and its national wealth gap. It appears that America’s wealth disparity began to spike just as the IRA and 401k started replacing defined benefit plans. This was also the same timeframe that American investors were separated by financial stature and divided into two distinct classes: accredited and non-accredited. As depicted in the chart below, unless and until…

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A CEO’s Perspective Crowdfunding with “REG CF Title III”


By Terry White is the Founder/CEO of athletic apparel company WOLACO. Crowdfund Beat Gust Post Since Title III of the Jobs Act just recently went into effect we decide to get a closer look at how CEOs actually view the new legislation in respect to their future financing needs. We had an opportunity for a Q&A with Terry White the Founder/CEO of athletic apparel companyWOLACO.  He was able to share with us the company’s history as well as their first crowdfunding experience with Kickstarter and his perspective on Title III. CT: What does WOLACO mean? TW: WOLACO is an acronym for Way of Life Athletic Co. I thought…

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What’s Seed Equity CrowdFunding, known as “REG CF Title III”?


By Rod Turner  founder and CEO of Manhattan Street Capital, Crowdfund Beat  Guest Editor, The SEC’s new Title III Equity CrowdFunding rules went into effect May 16th. These new rules expand Equity CrowdFunding to allow investors at all wealth levels to invest in startup companies. In June 2015, the SEC also enabled groundbreaking new rules called Regulation A+ which allow anyone to invest in startups and more established companies that need to raise up to $50 million. The capital raising landscape is making its biggest shift in decades. We now have an online fund raising continuum that extends from startups raising seed capital of as…

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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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Trouble In Paradise: Lending Club And Prosper


By Mark Roderick CrowdFunding Beat  Sr. contributing editor and crowdfunding attorney with Flaster/Greenberg PC. Lending Club and Prosper are going through a rough patch. Renaud Laplanche, the CEO and founder of Lending Club, just resigned amid allegations of financial irregularities, while Prosper recently laid off more than a quarter of its employees. But those are only the ripples on the pond’s surface. What’s going on underneath is that Wall Street is losing faith in the business model – that is, losing faith in the quality of the loans made on the Lending Club and Prosper platforms. Not long ago, Wall Street financial institutions couldn’t get enough of Lending Club and…

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Just another day…..

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  By Steve Cinelli , CrowdFund Beat Sr. Editor, @stevecinelli Quite the events in the marketplace finance sector over the last week.   Originally icons, now fallen stars, Lending Club (LC), OnDeck Capital (ONDK) and Prosper (PSPR) are exhibiting possible growing pains or even further symptoms of a more serious condition, namely questionable business models. It seemed only yesterday that firms such as Goldman Sachs and execs like Jamie Dimon expressed anxiety about the challenges to the conventional banking business that these new models would bring on.  Deal and profit erosion was the concern as these nascent yet compelling platforms were accomplishing what the banking industry couldn’t,…

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Why VCs Do Not Like Equity Crowdfunding


By Howard Marks Executive Chairman and co-founder at StartEngine Crowdfunding CrowdFund Beat Guest Post, In April 2012, President Obama signed the JOBS Act and announced that Americans will now have access to the capital they need from ordinary investors. Yet the media received the declaration quietly — meaning most U.S. citizens remained blissfully unaware of this revolutionary new regulation. The venture capital industry is probably one of the most vital sources of risk capital for our economy. It has produced the industry giants that command worldwide success: Google, Apple, Microsoft, etc. Without VC, most of those businesses would have never existed. Moreover, VCs have significantly contributed to our country’s technological success. Most people…

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Blue Sky, Regulators, Crowdfunding and “The Crowd”

Blue Sky, Regulators, Crowdfunding and “The Crowd”

By Paul Niederer Founder Raiseworth, CrowdFundBeat Sr. Guest Editor, What the crowdfunding industry has taught us worldwide is that “the crowd” will “out” a bad actor long before any of the regulators do. Regulators came out of the USA “blue sky” laws written state by state between 1911 and 1931. In these times there was no internet, little communication from town to town, regulators used broad laws to catch bad actors when they needed to, and when they found them. They may have got “tip offs” but as can be seen in this article the regulator often chooses their target.           It was…

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State of the Nation


By Steve Cinelli , CrowdFundBeat Sr. Editor, @stevecinelli We use the term “democracy” to describe our governmental structure.  Characteristic of such a term evokes “everyone has a vote”, “everyone has a say”, and that the majority, of equals, should determine the outcome.  This premise, no matter how noble, is flawed.   In the current state of political affairs, we are witnessing tremendous vitriol, overwhelming divisiveness, that those outside of our country are wondering what reality show has gone mainstream.  Or even further, might they be experiencing the implosion, if not demise of the greatest nation on earth before their eyes?     The United States is not…

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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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Mountain XpressFaces in the crowd: WNC crowdfunding initativesMountain XpressON THE SPOT: The scenes in Luke & Jo will be shot chronologically, which will allow for more improvisation in the dialogue, according to the feature film's crowdfunding page. Andie Morgenlander and E [...]

AZCentral.comTiny companies lure investors under Arizona crowdfunding lawAZCentral.comInvestors who make bets under the state's one-year-old crowdfunding law certainly have the potential to get in on the ground floor, but they must be patient and might not receive any returns. Th [...]

BloombergCouples Desperate For Children Turn to Crowdfunding FertilityBloombergCrowdfunding has become a popular mechanism for many couples who can't afford the high costs of IVF, or adoption and surrogacy. “It's not an easy thing to share publicly,” says Crystal Barrett, 33 [...]

MarketWatchWhy a crowdfunding site is giving out $10000 scholarshipsMarketWatchCrowdfunding site GoFundMe announced Thursday that it will award $10,000 to 10 students with pages on their site that fundraise for education. The award is part of a contest the site held throughout Septemb [...]

Huffington PostReal Estate Crowdfunding's Pathway of ChangeHuffington Post“Crowdfunding is just the Internet,” stated Attorney Mark Roderick as he opened last month's RealCap Chicago. RealCap is an annual conference that joins crowdfunding leaders and innovators to propel th [...]

BBC NewsNHS trust 'relies' on crowdfunding to equip wardBBC NewsAn NHS trust has launched a crowdfunding appeal to buy equipment for a new hospital unit because "it cannot get started without donations". The Royal National Orthopaedic Hospital (RNOH) in Stanmore, n [...]

MottoIVF: More Couples Crowdfunding to Pay for Procedure - MottoMottoMore and more couples are turning to crowdfunding to fund costly in vitro fertilization (IVF) treatments, Bloomberg reports.More Couples Who Can't Afford IVF Are Turning To Crowdfunding For HelpRomperCouples des [...]

EntrepreneurIs Crowdfunding Right for You? Answer These 7 Questions to Find Out.EntrepreneurCrowdfunding is a popular and increasingly accessible way to put your prospective product or business in front of millions of people. And, thanks to the visibility of massive success stories, t [...]

Boing BoingCrowdfunding a bike-lock that squirts vomit-inducing antipersonnel gas when cutBoing BoingThe Skunklock is a $109 crowdfunded gadget that contains pressurized vomit-inducing gas the creators call "Formula D_1," and which is intended to induce immediate vomiting wh [...]

WestwordProgressive-Rock Band Marillion Pioneered CrowdfundingWestwordThat was the beginning of crowdfunding for us — and for every band, really.” When it came time for the recording and release of the followup to the 1999 record, Kelly and the band realized that one of [...]

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