The Securities and Exchange Commission (SEC) convened at a meeting today, 30 October 2015 and voted YES  to the long awaited final law of the Jumpstart Our Business Startups (JOBS) Act on equity crowdfunding.  Three Commissioners of the SEC – Chair White, Stein and Piwowar – voted yes to the equity crowdfunding law. The Commission voted yes to: 1) Title III of the Jumpstart Our Business Startups Act, and 2) Proposed amendments to Securities Act Rule 147 and Rule 504.

First meeting of Crowdfunding Intermediary Regulatory Advocates (CFIRA) at Financial Industry Regulatory Authority  (FINRA) on 20 April 2012.   From left to right, Vincent Molinari (Gate Tech), David Drake (LDJ Capital and The Soho Loft),   Jason Best (Startup Exemption)  and Sherwood Neiss (Startup Exemption) 

Photo credit:  The Soho Loft

This rule opens the floodgates to online capital raising by removing the barrier that had allowed only the accredited investors to participate in online investments. The SEC made it possible for individuals  to solicit  for their projects when it approved Titles II and IV on  13 September 2013 and 25 March 2015, respectively, but these rules had excluded non-accredited investors.  

First meeting of Crowdfunding Intermediary Regulatory Advocates (CFIRA) at Securities and Exchange Commission (SEC) on 20 April 2012. From left to right,  DJ Paul (Crowdfunder), Sherwood Neiss (Startup Exemption), Chance Barnett (Crowdfunder), and Candace Klein (SoMoLend).

Photo credit:  The Soho Loft

With the adoption of the rules governing Title III, the amount of money that is possible to be raised across investment schemes will be significantly increased, especially in the real estate crowdfunding sector where there has been significant growth in recent times.

First meeting of Crowdfunding Intermediary Regulatory Advocates (CFIRA) at Securities and Exchange Commission (SEC) on 20 April 2012, from left to right Vince Molinari (Gate Tech), Brian Meece (RocketHub), Douglas Ellenoff, hidden (Ellenoff Grossman & Schole LLP),  D.J. Paul (Crowdfunder), Candace Klein (SoMoLend), Jason Best (Startup Exemption), David Drake (LDJ Capital and The Soho Loft), Chance Barnett (Crowdfunder)  and Alon Hillel-Tuch (RocketHub)

Photo credit: The Soho Loft

In December 2012, David Drake, Chairman of LDJ Capital, The Soho Loft Media Group and Victoria Global,  predicted that  this equity crowdfunding law will take more than 3 years before it is approved.  Now that the United States approved the equity crowdfunding law of the JOBS Act, it becomes the second nation after Italy, with a specific crowdfunding law.

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Source: ICNW