Why It Is So Difficult to Take Investment From Non-Accredited Investors

By: James Graves The Significance of Accredited Investors vs. Non-Accredited Investors The unfortunate reality of United States securities law is that your company cannot take investment money from just anyone. One of the most important distinctions in the world of fundraising and securities law is “accredited” versus “non-accredited” investors. An “accredited investor” is generally anContinue reading “Why It Is So Difficult to Take Investment From Non-Accredited Investors”

Raising Equity Capital for Your Startup: Securities Law Exemptions Ranked by Ease of Use

Raising equity capital for a startup properly can be challenging, but it is the first step before starting a successful business. Read below more information. Introduction If you are raising money capital from investors for your startup, no matter how you do it, there are rules you must be careful to follow. If you doContinue reading “Raising Equity Capital for Your Startup: Securities Law Exemptions Ranked by Ease of Use”

SEC Concept Release Letter

The SEC recently solicited the public’s views on its regulations on private offerings, issuing the Concept Release on Harmonization of Securities Offering on June 18, 2019. Our group worked hard to write a fifteen page response letter to the Commission containing our suggestions and overall thoughts. See below! Comments to SEC Concept Release Re FileContinue reading “SEC Concept Release Letter”

Be Careful Who You Issue Stock Options To Under Rule 701

Intro to Rule 701 Any time a company grants stock options or compensatory equity awards of any kind, the company must comply with the registration requirements of federal and applicable state securities laws or find an applicable exemption from the registration requirements. If you are a startup, the securities law exemption you will probably relyContinue reading “Be Careful Who You Issue Stock Options To Under Rule 701”

Indexing the Accredited Investor Standard to Inflation: A Bad Idea

Indexing the Accredited Investor Standard to Inflation: A Bad Idea Now that the election is over, it is unclear, at least to me, which direction startup public policy will take. It is in all of our best interests that we have a startup public policy that promotes innovation and creativity. Too often we have lawsContinue reading “Indexing the Accredited Investor Standard to Inflation: A Bad Idea”

The Accredited Investor Definition: Let’s Not Index it to Inflation

The first bill out of the new Congress next year might set the accredited investor definition to adjust with inflation. As the bill is currently drafted, every 5 years the financial thresholds would go up based on inflation. The bill is called the Financial Choice Act. You can find it here. I think this isContinue reading “The Accredited Investor Definition: Let’s Not Index it to Inflation”

A Good Day For Equity Crowdfunding

Yesterday was a good day for equity crowdfunding. Washington Governor Jay Inslee signed into law Washington HB 1593. This bill will make it easier for companies in Washington State to use Washington’s equity crowdfunding bill. If you like, you can watch the bill signing ceremony. Thank you Governor Inslee, Representatives Brandon Vick (R-Ridgefield) and Steve KirbyContinue reading “A Good Day For Equity Crowdfunding”

Washington State Equity Crowdfunding Update

Good news! Senators Fain and Mullet have sponsored SB 5680 in the Washington State Senate. This is the same bill as HB 1593 in the House. The bill would make important technical improvements to Washington State’s equity crowdfunding law The highlights of the bill include: Allowing Delaware corporations to use Washington State’s equity crowdfunding law.Continue reading “Washington State Equity Crowdfunding Update”

Washington State Equity Crowdfunding Update

My colleague Danny Neuman and I testified this morning in support of HB 1593. This bill would improve the Washington State equity crowdfunding law. The bill is sponsored by Representatives Vick and Kirby. HB 1593 Would Do a Number of Helpful Things HB 1593 would do the following: Eliminate the quarterly public disclosure of executive officerContinue reading “Washington State Equity Crowdfunding Update”

Accredited Investor: Two Tier System Coming?

The staff of the SEC has issued its report on the definition of “accredited investor.” It could be what we are looking at is the following: a “super accredited investor” definition (credit to Bill Carleton for coining this term), and the current definition–but if you don’t qualify as a “super accredited investor” you will beContinue reading “Accredited Investor: Two Tier System Coming?”