26 Dec Entrepreneurs Still Wait for JOBS
As 2014 draws to a close, entrepreneurs are still anxiously awaiting the release of the final rules of JOBS Title III from the U.S. Securities and Exchange Commission (SEC).
On November 1st, Washington recently passed legislation allowing equity crowdfunding for organizations operating in the state and investing 80 percent of their revenue in Washington. With this new legislation, this allows entrepreneurs to raise up to $1 million using equity crowdfunding.
Although not entirely approved and legal on a federal level, equity-based crowdfunding is attracting a lot of positive attention in small business finance. It is proving to be a great opportunity involving both accredited investors, startups, and established businesses on all levels. For those businesses seeking capital, resources, and funding, combining the power of investor network connections and he benefits of the Internet and online marketing are proving to be incredibly beneficial, and only have the potential to be even bigger once Title III is passed.
However, when the JOBS Act is fully implemented, we expect the investment crowdfunding community to have a large impact on entrepreneurs and startups. Currently an estimated 8.7 million accredited investors exist in the United States. Of the pool of non-accredited investors, which is approximately 300 million, these two groups combined would make for a huge boost in crowdfunding opportunities, seriously impacted businesses.
Most entrepreneurs are using either rewards-based crowdfunding or retrieving capital from their state crowdfunding laws, where possible, of course. One benefit to rewards crowdfunding is marketing, validating, and making products and/or offerings more visible among networks and even through online marketing channels.
Working with an equity-based crowdfunding firm can assist investors, startups, and small businesses with their funding plans. Participating and partnering in an equity crowdfunding program can include:
- Access to thousands of active accredited investors
- Investor targeting for finding the right investment partner
- Active private and public promotion partners for getting your deal in front of more people, more quickly
- Outsourced campaign management, providing you the freedom to work on the business, not the financing
All in all, as we cross into 2015, entrepreneurs still await the passing of JOBS III to make crowdfunding legal. However, when the time comes, the market of investors and entrepreneurs alike will be ready. The impact crowdfunding will have on investors, entrepreneurs, businesses, communities, and even the economy will be huge. Work with a team of expert investors and advisors to help startups and investors with their crowdfunding interests.