Spring Symposium 2013

Berkeley Business Law Journal
Berkeley Center for Law, Business and the Economy 
 

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The Jumpstart Our Business Startups Act or JOBS Act, is a law intended to encourage funding of United States small businesses by easing various securities regulations. One of the primary purposes of the JOBS Act is to ease the pathway to an initial public offering for small, emerging companies. The Title I of the JOBS Act (The IPO On-Ramp) deals with incentivizing small private firms to go public, which is thought to create jobs. However, there are various mechanisms within the Act that allow firms to stay private longer (i.e. Reg. A and 12(g)). Additionally, crowdfunding, the initiative that has been getting the most attention in the media, raises major concerns as a possible hotbed for fraudulent activity.

The Symposium is intended to address these apparent contradictions and discuss the likely effects of the new legislation.

Panel 1: The IPO ON-Ramp

The JOBS Act was designed to incentivize IPO filings as a response to the declining number of small companies that were choosing to go public. At the same time the Act creates a new category of issuer, the “emerging growth company” that allows firms additional 5 years to scale up to full public company status.

Why does the JOBS Act seem to contradict itself in this regard?  What does it say about the faith in the IPO process? Does it provide a mechanism that forces companies to go public before they are ready and when there is no support in the market? Or does this provide a cautionary tale about going public too soon?

The most important question our panelists will be faced with is whether the IPO on-ramp is really going to change the trend against IPO filings, and what caused the decline in the first place.

Panel 2: Crowdfunding

The JOBS Act also creates an exemption from the requirement to register public offerings with the SEC, for certain types of small offerings, subject to several conditions. This exemption permits entrepreneurs to “crowd-fund” their businesses -- that is, small businesses can raise money from large pools of small investors (limited to $10,000 or 10 percent of an investor's annual income, whichever is less) as opposed to being able to solicit investment solely from accredited investors. Moreover the Act allows the use of advertisements to solicit investments (a practice previously banned by the SEC), and allows the use of the internet "funding portals", which used to be extremely limited by law.

These changes will expose average Americans to a new type of investment risks, thus raising the question over whether the benefits of the crowdfunding exemption justify its costs.

 

Symposium Details

For more information about the event, our speakers, or the topics that will be discussed please visit the following links.

Agenda

Speakers Bios

Resources:      Panel 1      Panel 2      Related Resources

Where/When

Boalt Hall, Warren Room 295
215 Bancroft Avenue
Berkeley, CA 94720
Friday, March 15, 2013
8:45am-2:00pm

Up to three (3)  hours of CLE Credit available.

Sponsors

 

Berkeley Business Law Journal
http://www.boaltbblj.org/ bblj@law.berkeley.edu 

Berkeley Center for Law, Business and the Economy www.law.berkeley.edu/bclbe.htm
510-642-0532