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did reg A+ just make solo transactional a viable practice?
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Date: March 26th, 2015 3:33 PM Author: Silver floppy stead think about it – there are going to be SO MANY PEOPLE who want to "kickstart" their business, but doing it under reg A+ requires an s-1 style disclosure. for the extremely early-stage/vaporware companies that are going to be doing this, putting together that disclosure is not going to be that onerous – easy enough to charge some kind of moderate fee to put it together and a more substantial one if the financing actually goes through and the client has money.
EXCITING SHIT BROS.
edit: http://www.crowdfundinsider.com/2015/03/65007-the-reg-a-bombshell-50m-unaccredited-equity-crowdfunding-title-iv-takes-center-stage/ |
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Date: March 26th, 2015 3:51 PM Author: beady-eyed know-it-all dragon OFS. I put in my two weeks notice as soon as I heard the news. Am now frantically reading all the shitlaw threads. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27559833) |
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Date: March 26th, 2015 4:02 PM Author: Silver floppy stead if the required disclosures are actually as extensive as an S-1, it will be a pretty big pain in the ass to do this for an established company – BUT if you can get in early, handle the incorporation yourself, then just have a set of form documents that will be 95% applicable to any new company filing you do, you're golden.
the best part is, all these dudes in their garages will be playing with house money. charge a few grand (and some options) up front for incorporation + disclosure filing (to filter out the complete idiots, as much as for any other reason) and take substantially more in deferred compensation that becomes payable after the funding dates. most of these guys will fail spectacularly, as with all VC, but a few will succeed. |
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Date: March 26th, 2015 4:18 PM Author: beady-eyed know-it-all dragon I was joking in my last post but in all fairness this is actually pretty intriguing. The big knock on working with startups has always been that they never have cash, which this might actually ameliorate. I'd be careful before getting carried away with deferred compensation though -- just seems like so many service providers (attorneys included) got massively burned by taking payments in equity rather than in cash during the late 90s... (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560037) |
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Date: March 26th, 2015 4:29 PM Author: Haunting soggy market karate I suppose another advantage is that it is unlikely that the kickstartee investors will sue you the attorney for preparing an inadequate disclosure when things go south. This is traditionally the big bummer of this kind of work. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560114) |
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Date: March 26th, 2015 4:33 PM Author: beady-eyed know-it-all dragon IDK man, for a $50 million financing don't you think there's some hungry plaintiff's lawyer who might try to cobble together a class action?
(Not a litigation masterman) |
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Date: March 26th, 2015 4:43 PM Author: mustard windowlicker $50 million? wouldn't this be for more like $5 million? (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560191) |
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Date: March 26th, 2015 4:45 PM Author: Haunting soggy market karate I was thinking more like 500 k. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560208) |
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Date: March 26th, 2015 4:48 PM Author: mustard windowlicker yeah that's probably more accurate. the biggest Kickstarter project ever only raised $8.7 million, and that was a cash-in on an enormous brand built up over almost a decade:
https://www.kickstarter.com/projects/elanlee/exploding-kittens |
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Date: March 26th, 2015 5:06 PM Author: beady-eyed know-it-all dragon Yeah but kickstarter is essentially a donation platform (or a pre-ordering platform, depending on the type of project). Equity funding is different. I'm not going to give more than $100 to a kickstarter campaign because I'm not getting that money back... but if I'm looking to make an investment (and generate returns), I'll have to put in a significant amount of money to generate significant returns. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560305) |
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Date: March 26th, 2015 4:45 PM Author: Haunting soggy market karate I don't think we're talking 50 big bills, my man. Also a class action against the attorneys who handled the disclosures? Idk (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560206) |
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Date: March 26th, 2015 5:03 PM Author: beady-eyed know-it-all dragon Yeah, I'm guessing big financings (i.e., ones in the tens of millions range) will be relatively rare, but you never know.
And again, I am not a litigation masterman, but I am assuming that if the attorney fucked up a disclosure, a class action would be brought against the company, and once the company lost they would turn around and sue the attorney for malpractice. |
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Date: March 26th, 2015 4:40 PM Author: Electric amber striped hyena water buffalo I'm intrigued. This might make early-stage patent prosecution even more viable. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560177) |
Date: March 26th, 2015 4:23 PM Author: Histrionic spruce indirect expression please delete all poasts ITT. ty (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560081) |
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Date: March 26th, 2015 4:45 PM Author: dun stain stag film lol (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560209) |
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Date: March 26th, 2015 5:05 PM Author: burgundy elastic band ladyboy (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560301) |
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Date: March 26th, 2015 5:05 PM Author: mustard windowlicker isn't this ideal for real estate development? building a shopping center, hotel or small office building is right in that $10M to $50M range. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560300) |
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Date: March 26th, 2015 5:06 PM Author: Odious plum jap goyim what type of filing are you going to have to fill out? have they released them yet? (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560304) |
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Date: March 26th, 2015 5:20 PM Author: mustard windowlicker http://www.sec.gov/about/forms/form1-a.pdf (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560368) |
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Date: March 26th, 2015 5:27 PM Author: Histrionic spruce indirect expression please edit out ty (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27560393) |
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Date: March 26th, 2015 10:17 PM Author: Thriller Property Cuck I'm just a bro in San diego that would team up with you bros on this and do some moonlighting (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27562182) |
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Date: March 26th, 2015 10:30 PM Author: Fluffy appetizing party of the first part that chart at the end of the blog is extremely helpful to understanding this issue (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27562288) |
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Date: March 27th, 2015 12:21 AM Author: Heady Background Story what exactly is the advantage of this? isn't raising $$ in these amounts just generally going to be a private placement? i dunno. seems nigger (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27563007) |
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Date: March 27th, 2015 12:24 AM Author: mustard windowlicker you can raise from non-accredited investors and you can publicly advertise. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27563024) |
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Date: March 27th, 2015 12:38 AM Author: Silver floppy stead this exactly. also relaxes the # of investors you can have before becoming a reporting company – other methods are at best 500 unaccredited/2000 total. so now you can fund your commercial office building with 20,000 $100 investments with no additional reporting requirements.
now, the number of people who will actually raise that is small. but it's not zero. and the number of people who try, especially at first, will be high. |
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Date: March 27th, 2015 12:40 AM Author: Massive Cracking Azn Associate you need audited financials apparently. so this is a real business not some garage idea. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27563105) |
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Date: March 27th, 2015 12:47 AM Author: Silver floppy stead for < 20m it's just reviewed financials, friend. given an early stage company the cost is not high. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27563126) |
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Date: March 27th, 2015 5:15 PM Author: mustard windowlicker http://www.lawgives.net/blog/equity-crowdfunding-what-does-regulation-a-mean- (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27566289) |
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Date: March 27th, 2015 5:15 PM Author: Diverse ceo The answer may surprise you. (http://www.autoadmit.com/thread.php?thread_id=2839552&forum_id=2#27566294) |
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Date: March 27th, 2015 5:37 PM Author: Histrionic spruce indirect expression benzo please delete this thread.
Thank! |