October 3, 2012
I have a small business, with substantial expansion opportunities. However, I need additional capital to expand. I have an attractive business plan that demonstrates my business expansion opportunities. The banks aren't willing to lend the capital that I need because they are still dealing with their own problems (I would add that many of these banks' securities are registered with the SEC and investors in those securities have still suffered huge losses so much for registration of securities protecting investors). I can't advertise to the public that I need investors to expand my business. If I had access to the capital, I would immediately hire five additional employees, with average pay of approximately $100,000 per year per employee. That's an addition of $500,000/year to our payroll. My guess is that there are many other small businesses that are facing this same situation.
Congress and the President appreciate that the existing laws regarding general solicitation do more harm than good and changed the law in an effort to Jumpstart Our Businesses. Nothing has been "jumpstarted" because the SEC is ingoring the will of Congress and the President and is not following the law, which mandated that the SEC adopt the new rules within 60 days of the passage of the JOBS Act. The SEC needs to immediately implement its proposed rules on October 6th, a day after the public comment period is over. The SEC also needs to respect the intent of the new law by allowing an issuer to take reasonable steps to verify that its investors are accredited. Any requirements beyond having the investors self-certify that they are indeed accredited are unreasonable. Many commentators seem to think these new laws are all about hedge funds, and forget that there are other small businesses that are harmed by these ridiculous laws that limit the freedoms of businesses and investors. Please take action immediately to implement these proposed rules. Small businesses have suffered long enough.