A good starting place for the latest on the ‘crowd funding’ bills in the Congress and Senate is: http://venturebeat.com/2011/12/05/faq-what-startups-should-know-about-the-u-s-crowdfunding-bill/ and there are a few other articles there that talk about crowd funding.
I did want to point out some of the sticking points that none of these articles have mentioned though:
H.R. 2930 – Provisions whether using an intermediary or not
outsource cash-management functions to a qualified third-part custodian, such as a broker or dealer registered under section 15(b)(1) of the Securities Exchange Act of 1934 or and insured depository institution; In other words, you have to give the checkbook to a stock broker or banker. I am wondering what they will be charging for it all.
Verification of income – For purposes of section 4(6), an issuer or intermediary may rely on certifications as to annual income provided by the person to whom the securities are sold to verify the investor’s income. In other words, be prepared to find out what your friends make every year, if you are not doing this with an intermediary.
Purchaser may not resell their investment for a period of one year unless sold back to the issuer or an accredited investor.
S.1791 – The Congressional bill is essentially the same as the House bill with the exception of annual limits and per investor limits.
With all of the lunacy going on in Washington at the moment I be very surprised if this is all works out during calendar year 2012.
But then again the House approved their version by a vote of 217-17.
Thank you for coming!