SEC Seeking Input on Crowdfunding
The Securities and Exchange Commission is looking for feedback from entrepreneurs and small business owners on a proposed rule to implement equity-based crowdfunding as required by the Jumpstart Our Business Startup (JOBS) Act. While the proposed rule will allow a startup or small business to offer an equity stake in exchange for an investment, it imposes limitations, reporting and record-keeping requirements on entities seeking to raise capital through crowdfunding. The rule also imposes registration, reporting and recordkeeping requirements on the website portals that small businesses will use for crowdfunding transactions.
The SEC is hoping to strike the right balance in protecting individual investors while not being so burdensome for entrepreneurs. Entrepreneurs, small business owners and others have until February 3, 2014, to provide formal comment.
This and other opportunities for entrepreneurs and small business owners to comment on federal regulations are available as part of the Small Biz Reg Watch from the U.S. House Committee on Small Business.