The JOBS Act: Initiatives and Challenges of the New Legislation
Panel 2 - Crowdfunding
Description: 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, 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. These changes will expose average Americans to a new type of investment risk, thus raising the question of whether the benefits of the crowdfunding exemption justify its costs.
Sponsor(s): Berkeley Business Law Journal Sponsor: Berkeley Center for Law, Business and the Economy
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