The U.S. Securities and Exchange Commission (SEC) has finally pulled the trigger on Title III of the JOBS Act, intended to expand funding options for startups by easing various securities regulations.
Last week, they announced the adoption of rules for non-accredited investors to participate in securities-based crowdfunding by lifting what is commonly known as the ‘general solicitation’ ban.
Equity crowdfunding transcends common means of reward-based campaigns found on Kickstarter, Indigogo, etc. — whereby supporters receive some value other than ownership. The overall premise with equity crowdfunding is startups can legally solicit actual cash investment from the general public in due time and with proper registration. This is promising for those ventures that want an option to raise outside the tradtional angel / venture path.