SEC JOBS ACT for Crowd Funding Sites
Equity Crowd Funding and the New JOBS Act
|Jumpstart Our Business JOBS Act|
The Future of Crowd Funding
Think about that for a moment and it's clear this is a huge win-win for all parties involved. Instead of offering your new invention as an incentive to contribute to your Crowdfunding Campaign and basically sell the product with a "time stamp" you are selling a percentage of the business in small increments but still keep a controlling interest while bringing in several micro-investors all interested in your products success. If you yourself do not have a large social network but your investors do, it is to their financial advantage to give you a shout out and ultimately increase the over-all sales.
THE JOBS ACT IS HUGE and Will Define CrowdFunding and how Crowd Sourcing for new Businesses are funded Online in the Future.
I believe it was John D. Rockefeller who so famously said " I would rather earn 1% from 100 peoples efforts then 100% of my own". Obviously no one is going to sell 99% of their business for this statement to become true but having 100 micro-Investors all contributing to your success, as well as their own, could be the huge burst of built-in marketing that your invention really needs.
On the Investors point of view it's the perfect analogy that can make future Crowd Funding Investors Very Rich. Would you rather stick all your eggs into one basket and HOPE nothing happens on what seems like a good investment, or would you rather take those same eggs and spread them around and diversify your investments? What kind of a portfolio could you build by BELIEVING and be willing to invest a small amount of money for a small amount of the future profits and the success of even just one clear winner?
As much as Crowd Funding has already become a huge success in just a few short years, the future is Clearly Bright IF the JOBS ACT ever gets passed and made into Law for small businesses and investors alike. Congress passed a new law last year which paves the way for Crowdfunding Campaigns to accept money up to a million dollars for a stake in your business or up to $50 million in stock without filing with the SEC. President Obama did sign-off with his approval on the Jump Start Our Business Jobs Act last year which would drastically help create new jobs and keep the American Dream Alive using 21st Century technology. Unfortunately the bill still seems to being held up by the SEC which after a full year is still working out the details.
So what would it be like for the average investor to invest in a start-up and have a equity stake in it's success? Actually there is already several funding sites that already accept these types of investments such as MicroVentures.com that works with established Angel Investors. Each potential start-up or business needs to be seeking between $100k and $500k in capital and will be thoroughly checkout before they are accepted to participate.
When the Jump Start Our Business jobs Act finally does go into effect it will make it much easier for small investors and small businesses alike to finally be able to participate in large deals but on a micro level.
President Obama said “this will help entrepreneurs raise the capital they need to put Americans back to work and create an economy that’s built to last.”
A Great (but complex) idea whose time has finally come to let anyone who wants to invest in a new business or product have that opportunity without having a seven figure bank account first.