Nasdaq OMX Group, Inc. announced today that it will enter into a joint venture with SharesPost, Inc. to form a marketplace for the trading of shares of unlisted companies. This is an interesting and cutting edge move that solves some problems for both Nasdaq and SharesPost. This new marketplace should be very positive for rapidly… Continue Reading
Category Archives: Capital Raising
Subscribe to Capital Raising RSS FeedSEC curtails JOBS Act broker registration exemption in recent FAQs
Posted in Capital RaisingI understand that the SEC needs to balance having efficient markets and facilitating capital formation with the protection of investors, but sometimes erecting roadblocks with the intent of protecting investors is merely regulation for regulation’s sake. On February 5, 2013, the Staff of the Division of Trading and Markets of the SEC provided guidance on… Continue Reading
SEC advisory committee to recommend formation of small company securities exchange
Posted in Capital RaisingAn SEC advisory committee is likely to recommend that that the SEC support the formation of a new securities exchange designed especially for small cap and micro cap public companies. While this new exchange is a long way from approval and operation, strong SEC support could substantially increase its chances of successful implementation. This… Continue Reading
Did the JOBS Act unintentionally change the statutory private offering exemption?
Posted in Capital RaisingFor securities issuers, the most widely used exemption from registration is the private offering exemption in Section 4 of the Securities Act. Formerly referred to as the “Section 4(2)” exemption, the enactment of the JOBS Act in April of this year fixed the section numbering in Section 4 of the Securities Act which, until now,… Continue Reading
GUEST BLOGGER: Tick size remains large obstacle for middle market public companies
Posted in Capital RaisingMr. Steiner is the Chief Operating Officer and Managing Director – Investment Banking at Ladenburg Thalmann & Co. Inc. The views expressed in this posting are Mr. Steiner’s personal views and should not be attributed to Ladenburg Thalmann & Co. Inc., its employees, affiliates or subsidiaries or to Gunster. While the Jumpstart Our Business… Continue Reading
Update on the JOBS Act: Where are we now?
Posted in Capital RaisingAfter a flurry of news articles when the JOBS Act became law in April, the news cycle has been non-stop election coverage. While we all look forward to the end of the political advertisements (especially us Floridians), I wanted to take a moment to bring you up to date on the JOBS Act. So, where… Continue Reading
Regulation A+: Raise the capital you need without the hassle or expense
Posted in Capital RaisingRegulation A+, one of the most overlooked provisions of the JOBS Act, promises to be the best new way for private companies to raise money without the headaches of going public or the restrictions of private offerings. As part of the JOBS Act, the SEC was tasked with creating a new offering exemption that has… Continue Reading
Securities Law 101 (Part II): Avoiding the pitfalls in a private placement
Posted in Capital Raising, Financial InstitutionsThis is the second part of our Securities Law 101 series. Because capital raising is such a critical function for emerging start-up companies, we designed this series to introduce their management teams to some of the fundamental concepts in securities law. We hope that this series will prevent some of the most common mistakes management… Continue Reading
Elimination of ban on general solicitation and advertising may leave some questions unanswered
Posted in Capital RaisingDepending on your perspective, lifting the ban on general solicitation and advertising for private offerings is one of the most anticipated or feared provisions in the JOBS Act. Consumer protection groups are aghast at the potential of fraud stemming from startup companies hawking their stock to unsophisticated investors. Pro-business groups are ecstatic that someone finally… Continue Reading
Securities Law 101 (Part I): Yes, securities law applies to you
Posted in Capital RaisingThis is the first part of our Securities Law 101 series. Because capital raising is such a critical function for emerging start-up companies, we designed this series to introduce their management teams to some of the fundamental concepts in securities law. We hope that this series will prevent some of the most common mistakes management… Continue Reading
SEC grants accelerated approval of new FINRA private placement rules
Posted in Capital Raising, Financial InstitutionsBowing to industry pressure, FINRA has adopted vastly scaled back private placement requirements under FINRA Rule 5123. Originally proposed in October 2011, the proposed rule was highly controversial because it significantly infringed on the capital raising process. In particular, the originally proposed rules would require each offering to have an offering document, which must include… Continue Reading
The new crowdfunding exemption: much ado about nothing
Posted in Capital RaisingSocial media is all the rage and seems to be rearing its head in just about every aspect of daily life. Turn on any television news program, whether CNN, ESPN, or any other, and you’ll be sure to be brought up to date with who has “tweeted” what to whom or what someone’s latest facebook… Continue Reading
Solicitation for Comments on the JOBS Act
Posted in Capital RaisingThe SEC Advisory Committee on Small and Emerging Companies has announced a public meeting to be held at 9:00 a.m. on Friday, June 8, 2012 in Multi-Purpose Room LL-006 at the SEC’s Washington, D.C. headquarters. The meeting will be webcast on www.sec.gov. The agenda for the meeting will be to focus on the JOBS Act… Continue Reading
JOBS Act update: Keeping current with the SEC’s interpretations
Posted in Capital RaisingThe SEC has been busy over the past several weeks rapidly issuing interpretations and procedures to implement the JOBS Act. Because the JOBS Act is such a fundamental change to securities law, especially for middle market companies, we wanted to spend this blog catching you up to speed on how the JOBS Act looks since we… Continue Reading
SEC continues to issue FAQs on the JOBS Act
Posted in Capital RaisingThe SEC has been issuing a steady stream of FAQs on the newly enacted JOBS Act. On Monday, the SEC’s Division of Trading and Markets issued a set of FAQs on the JOBS Act addressing crowdfunding intermediaries. Last week, the Division of Corporation Finance issued more FAQs on JOBS Act issues such as qualifications for… Continue Reading
Senate passes JOBS Act, with amendments, which fundamentally alters securities laws
Posted in Capital RaisingRapidly moving legislation dubbed the Jumpstart Our Business Startups Act (JOBS Act) was passed today by the U.S. Senate, which fundamentally alters the securities laws. The business world is buzzing about the pros and cons of this Act. The Act is designed to invigorate the IPO market by removing restrictions on capital raising that many… Continue Reading
House Votes to Make Capital Raising Easier
Posted in Capital RaisingIf the U.S. House of Representatives has its way, big changes are on the horizon for private offerings. In an effort to enhance the ability of small businesses to raise capital, the House has now passed four bills that reduce some of the restrictions. The bills are as follows: 1) Entrepreneurial Access to Capital Act… Continue Reading
FINRA Proposes Rule 5123 (Private Placement of Securities)
Posted in Capital RaisingEarlier this month, FINRA proposed new Rule 5123 to regulate private offerings. Proposed Rule 5123 is a second attempt by FINRA this year to expand the regulatory process on private offerings. In January, FINRA had proposed a much more comprehensive set of changes, including proposed regulations affecting private placements not involving a FINRA member firm. … Continue Reading
Positive Events in Small Company Capital Raising Arena
Posted in Capital Raising, Technology Company IssuesThe economic events of recent years have hit small companies particularly hard. While virtually everyone has suffered, small companies endured a double hit as they experienced substantial challenges to sales and profitability as well as a widespread inability to raise capital. This inability to raise capital was made worse by these economic events, but the… Continue Reading
SEC Adopts Amendments to Form S-3 Eligibility
Posted in Capital RaisingOn July 26, 2011, the SEC approved amendments to eligibility criteria for use of the short form registration statement on Form S-3. To use the short form registration statement, a proposed offering must meet both the issuer eligibility requirements and a transaction eligibility requirement. While there are several available transaction eligibility standards, a frequently relied… Continue Reading
Financing Early Stage Companies–Dealing With the “New Normal”
Posted in Capital Raising, Technology Company IssuesWe have recently experienced some of the worst financial and economic conditions that we (hopefully) will see in our lifetimes. Most of us have been touched personally by these conditions. It appears that economic and financial conditions will continue to get better, but these situations have created some ongoing challenges that will continue to face… Continue Reading
SEC to Consider Possible Exemption for Micro-Finance Offerings
Posted in Capital RaisingIn a response letter to Representative Darrell Issa (R-CA) dated April 6, 2011, Mary Shapiro, the Chairman of the Securities and Exchange Commission (“SEC”), indicated that the SEC would be reviewing the feasibility of, among other things, a new exemption from registration for micro-financing or “crowdfunding.” Crowdfunding generally refers to the pooling of small contributions… Continue Reading
FINRA Proposes New Regulation on Nonpublic Offerings
Posted in Capital RaisingRecently, the Financial Industry Regulatory Authority, Inc. (“FINRA”) issued a proposed amendment to Rule 5122 to further regulate nonpublic offerings. The proposed amendment would cause significant changes in the nonpublic offering process including the following: Disclosure Requirements – All offerings must have an offering document. The offering document would be required to disclose (i) the… Continue Reading