Leaders in technology industry discuss crowdfunding

brian Yu The Daily Illini

brian Yu The Daily Illini

Leaders of the Champaign-Urbana technology industry discussed new investment opportunities Wednesday at the iHotel and Conference Center for the quarterly CU CEO Tech Roundtable.
The purpose of these roundtables, sponsored by Research Park, is to bring together presidents, CEOs and founders of tech companies so they can learn from each other, share success stories and address specific subject matter, said Laura Frerichs, director of Research Park.
“The businesses certainly like the opportunity to learn from each other,” Frerichs said. “It is a difficult path to be a startup entrepreneur. Being able to have this peer group to be able to call upon and to be able to network with and to ask questions has been well received.”
Brian Jurczyk, chairman of the roundtable and CEO of Starfire Industries, said the event was an opportunity to educate startup companies on new and relevant issues such as marketing, technology and legal aspects.
Guest speaker Spencer Wood, shareholder from Polsinelli Shughart PC law firm in Chicago, said the roundtable events focus on a specific topic. Attendees discuss these subjects with experts who come in and address issues, whether legal or business related, that affect attendees’ companies.
“Whenever leaders of companies get together and share ideas and discuss issues…it results in lot of knowledge sharing,” Wood said.
Wood and Christopher Pesch, another guest speaker and shareholder from the same law firm, addressed this quarter’s issue, which was of changes in crowdfunding. The presentation included ways for businesses to raise their capital when they need money and how they can use crowdfunding to their advantage.
Crowdfunding is when a startup company or small business receives small investments toward their company from groups of people who normally would not be considered “qualified investors” because they may not understand the risks associated with investing.
“The concept of crowdfunding is a really big deal because as soon as the law is written, startup companies will be able to raise money for businesses and be able to do it through a crowd and get their companies off the ground,” Jurczyk said.
Before the passing of the JOBS Act in 2012, there were restrictions and limitations on what the Securities and Exchange Commission considered a qualified investor. Crowdfunding was strictly limited to those who matched the criteria of a qualified investor, such as having more than $1 million in assets or making more than $100,000 per year. Jurczyk said certain groups of people, such as students or friends, who were previously deemed “not qualified” will now be able to invest in companies.
“Crowdfunding is not currently available in the form that was passed in the 2012 JOBS Act,” Wood said. “We’re waiting for the SEC to pass regulations to implement the law. Until those rules come out, the law doesn’t allow crowdfunding to go into practice in this form.”
Source: Daili Illini – By: Jacqui Ogrodnik

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