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”

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”

Public Policy: Remove Taxes on Sharing Stock With Workers

Our federal tax system, the public policy, makes it unnecessarily difficult for private companies to share stock with their employees, contractors, advisors, and other service providers. The problem lies in our tax law. The Problem with Issuing Shares to Workers Why doesn’t your employer bonus your shares? Because the IRS treats any share bonus asContinue reading “Public Policy: Remove Taxes on Sharing Stock With Workers”

How to Use and Review Non-Disclosure Agreements (NDAs)

We are frequently asked by clients to review Non-Disclosure Agreements (“NDAs”) in various contexts. It goes without saying that you should be careful of what kind of NDA you sign and not be afraid to negotiate any terms you do not like.  Nondisclosure or confidentiality agreements come in a wide variety of forms and styles,Continue reading “How to Use and Review Non-Disclosure Agreements (NDAs)”

More Notes, More Problems: Musing on Convertible Notes and SAFEs

Convertible notes, SAFEs, and every other type of convertible equity instrument are to startup financings what bread is to a sandwich, or Ringo is to the Beatles—not the most exciting part, but they’re almost always there, and you’re kinda stuck with them. In our experience, most early-stage companies use some form of convertible instrument forContinue reading “More Notes, More Problems: Musing on Convertible Notes and SAFEs”

What is Personally Identifiable Information (or “PII”)?

Personally Identifiable Information (“PII”) has become a buzzword in the privacy law world the last few years, and it is heavily protected by rules and regulations around the world, such as the General Data Protection Regulation (GDPR). Companies that fail to comply with regulations such as the GDPR, or that suffer a data breach, faceContinue reading “What is Personally Identifiable Information (or “PII”)?”

The CCPA – Does it apply to your business?

The California Consumer Privacy Act (“CCPA”) became effective at the start of 2020. Its purpose is to protect the personal identifiable information (“PII”) of California consumers. The bad news for businesses is that the California Consumer Privacy Act’s legal requirements are murky at best. And, even in its infancy, the CCPA has been in aContinue reading “The CCPA – Does it apply to your business?”

CCPA – Who are California Consumers?

The California Consumer Privacy Act (“CCPA”) has some twisty definitions of who is – and isn’t – considered a California consumer. The text of the CCPA says a business who “alone or in combination, annually buys, receives for the business’s commercial purposes, sells, or shares for commercial purposes, alone or in combination, the personal informationContinue reading “CCPA – Who are California Consumers?”