Paul Spinrad, MAKE’s Executive Editor, has a brief piece on O’Reilly Radar today about movement in DC on a crowdfunding exemption. Here’s an excerpt:
In May, I wrote here about efforts I’ve been involved with advocating a “crowdfunding exemption.” As part of the American Jobs Act introduced by President Obama last night, the White House announced that it will work with the SEC on implementing something along these lines. Here’s how the White House Office of Science and Technology explains it on their website:
As part of the President’s Startup America initiative, the Administration will work to unlock this capital through smart regulatory changes that are consistent with investor protection. This means reducing the disproportionately high costs that smaller companies face when going public, as well as raising the cap on “mini” public offerings (Regulation A) from $5 million to $50 million. It also means responsibly allowing startups to raise money through “crowdfunding” – gathering many small-dollar investments that add up to as much as $1 million. Right now, entrepreneurs like these bakers and these gadget-makers are already using crowdfunding platforms to raise hundreds of thousands of dollars in pure donations – imagine the possibilities if these small-dollar donors became investors with a stake in the venture.
Hear, hear! In a conference call with the press immediately after Obama’s address, U.S. Chief Technology Officer Aneesh Chopra and Office of Science and Technology Policy Deputy Director Tom Kalil explained that they advocate an exemption, or at least a streamlined and less-expensive registration process, for public securities offerings of $1 million or less, with individual investment capped at $10K. They also said that they believe the SEC has the authority to make this regulatory change, no legislation required.
Read the rest of it: Crowdfunding Gets Traction in DC
And more background can be found in Paul’s original Radar post on the subject.