When Arkansas Business' Jan Cottingham wrote about crowdfunding in Arkansas in May, she noted that regulatory work toward equity crowdfunding, or securities crowdfunding, had stalled.
Equity crowdfunding was part of the bipartisan Jumpstart Our Business Startups Act — or JOBS Act — approved by Congress more than a year ago. It was designed to help small business gain access to capital.
But the federal Securities & Exchange Commission had so far failed to write the regulations that would let “non-accredited” investors — those who don’t have a high net worth — buy equity stakes, leaving those non-accredited investors shut out of equity crowdfunding.
But according to the Wall Street Journal, the SEC has finally moved on writing those regulations:
The Securities and Exchange Commission voted 5-0 to propose rules aimed at helping startups sell shares through online "portals," where supporters say thousands of investors could pore over the business plans of small companies and choose promising investments. The proposal would implement a key provision from last year's Jumpstart Our Business Startups Act, a law meant to spur business activity.
"We want this market to thrive, in a safe manner for investors," SEC Chairman Mary Jo White said.
Critics point to risks, including exposing unsophisticated investors to fraud. But proponents say the move will be great for small startups who would be able to quickly and more efficiently raise money from a wider pool of investors.
- Video: ASU Exploring On-Campus Hotel, Convention Center
- After Supremes' Decision, Womack Urges Congress to Act on Online Sales Tax
- WSJ Examines Mark Pryor, Tom Cotton Senate Race
- Recovery of Dassault Falcon Jet Benefits Arkansas 11 hours ago
- New Kanis Plaza Owner Arrives in $1.5M Sale (Real Deals) 11 hours ago
- Citizens Bank Puts Phil Baldwin To Work On Growth 11 hours ago
- Nearly $3 Million Still Sought in Rogers Bancshares Bankruptcy 11 hours ago
- Wal-Mart's Costs Connected To Mexican Bribery Case Reach $400M 11 hours ago