What is a “PIPR”? Private Issuer Public Raise

By Lauren Leibowitz, CrowdFundBeat Guest Contributor, Principal at 1st BridgeHouse Securities, LLC,

PIPR is an acronym for Private Issuer Public Raise. A PIPR (noun) is a private company that raises capital by soliciting investors publicly while relying on various SEC exemptions (i.e Reg D 506(c)) in order to stay private. Today, a public solicitation can occur online. Even though a private company is raising capital publicly, by claiming certain exemptions, will not be subject to public reporting requirements set by the SEC, which include public disclosure of financial statements and annual 10-k reports.

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ORIGIN OF THE WORD

The ban of general solicitation on Reg D Private Placements was lifted as a result of the JOBS Act being signed by President Obama in April 2012. When it went into effect on October 23, 2013, a new category of exemptions, Reg D 506(c), became effective. PIPR is trademarked by eBarnRaiser, LLC. eBarnRaiser, LLC along with 1st BridgeHouse Securities, a FINRA member broker dealer, developed eBRCapital.com, a crowd financing platform that solicits and connects PIPRs with accredited investors. Title III which proposes Equity Crowdfunding is still pending SEC regulations as of today, but certain states have passed their own intrastate crowdfunding exemptions. Title IV which amended Reg A is now typically referred to Reg A+; makes it possible for an issuer to become public and as long as less than $50 million is raised (and certain other requirements are adhered to) then any investor, either accredited or unaccredited, may invest.

Crowdfunding is used as a general term when it comes to raising capital for a small business. It does not specifically make a distinction whether the funds are coming from a backer or investor, meaning whether the transaction is considered a regulated financial transaction. The non-regulated crowdfunding transactions are generally reward based. The participant receives a product made by the company, or receives a tee shirt or some other “reward” in exchange for making his investment. Donation crowdfunding where the backer receives nothing but the satisfaction of participating in a capital raise. Equity Crowdfunding (Title III- rules are still pending from the SEC) will allow an unaccredited or accredited investor to purchase a security (equity or debt) and become an investor in a small private business. Title II (Private Placements via Reg D 506(c)) and Title IV (Reg A+) of the JOBS Act are considered types of crowdfunding, but are also generalized as crowdfinancing to differentiate itself from crowdfunding. There are very different rules and regulations when it comes to raising capital using these new exemptions. Only accredited investors can participate in a Reg D 506(c), while accredited and non-accredited investors can participate in a Reg A+ transaction.

PIPR PLATFORM

eBRCapital.com is powered by 1st BridgeHouse Securities, a FINRA member broker dealer and is helps companies manage their capital raises using by becoming a PIPRs. eBRCapital brings the capital raising and investment banking process to the digital world while expanding the universe of potential investors. If you are interested in raising capital for your private company or investing in private companies visit eBRCapital.com and contact 1st BridgeHouse Securities at Info@1stBridgehouse.com

Lauren LeibowitzPrincipal at 1st BridgeHouse Securities, LLC,

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