The Minnesota equity crowdfunding initiative for non-accredited investors has escaped the wrath of the Department of Commerce (MNDoC).
SF 138 aka MNvest, was gravely threatened by the State’s securities regulator Mike Rothman last month as articulated in an official document outlining his “major concerns”.
Through a series of closed door meetings — the lobbyists, legislators and regulators battled over each item, and in the end, those in favor of a stronger statewide economy with more options for entrepreneurs prevailed.
Rothman & gang didn’t manage to kill the bill, but they did reduce the potential for broader positive impact by reducing the amount any single issuing company could raise from $2m unaudited and $5m audited to $1m and $2m, respectively.
“After several weeks of meetings between representatives from the Department, Sen. Bonoff, Sen. Peterson, various business leaders, and other securities attorneys from around town, I think we’ve managed to come up with a bill that strikes a good balance between protecting potential investors and promoting business growth. Most importantly, it’s a bill that can, and should, pass the Minnesota legislature,” said business attorney and MNvest champion Ryan Schildkraut.
Post MNDoC, MNvest sailed through a Senate Judiciary and House Goverment Operations Comittee last week; as a next test, the bill will need to pass House Jobs and Senate Finance – Environment, Economic Development and Agriculture Budget Division committees. Although the largest battle may have been won, there is still room for debilitating handicap or outright failure before it becomes legal for entrepreneurs to advertise and promote their fundraising intentions to the general public.