September 6, 2014
Not just for startups, but for indie inventors, artists, authors, independent filmmakers and all around 'creatives' that have been professionally developing their own original ideas for decades -THIS IS A VERY IMPORTANT ACT.
Being forced to share or give up full ownership of their works with distributors in return for advertising and small opportunity in employment is horrible business. Entrepreneurs have established a large base of support for what they do without the majors, thanks to long established careers, the internet and mobile devices. Many of them do not want to deal with "a major", but instead own all of their own work and self distribute to clients and the general public who have a demand for it. Having their own business that they can pass down to their family -while strengthening the backbone of the economy with TRUE growth- I think for the most part, is the goal for many of them. To live their American dream doing what they love and make a living doing it. The act with smarter provisions can provide that full opportunity FOR ALL who want to chase their AMERICAN dream.
The general public and a very large percentage of businesses all across this country have spent the last 20 years assimilating to the fact that everyone is online now. Many don't bother to do their research at their local library anymore if they have a computer or smart device handy. College students and parents alike shop online for everyday necessities, job ops and to prepare in advance of the holidays. Most emails sent today are sent originally from smartphones, using the email host as "a middle man" for backup. Disregarding the post office even more.
There are trusted analytics that can be found that can show you just how many people shop -and also look for opportunities to grow their businesses online. Many American businesses have survived over the past decade simply for being able to advertise ethically online and process orders through a website with social networking providing updates to customers.
To regulate the intermediary funding portals and establish disclosure and other criteria for them, I feel, requires more of the publics involvement. Including compliance with existing anti-money laundering provisions and the requirement to report suspicious activity. Definition of said compliance should be advertised -once approved and should not HURT small businesses through costs just to meet them.
Despite the positive improvements of the law, crowd funding defined by your proposal doesn't seem like it offers opportunities for every small company anymore. That weighs on my mind. As proposed by you (SEC) crowd funding would carry a sizable price tag -that I feel- many are going to tell you is unfair for their business. The expertise and costs required just to to comply with financial reporting are estimated at between 15-20% of the funding request. Is this the best we can do?? In the digital age, how could that be? That's beyond the capabilities of many fledgling firms and endangers the act, possibly rendering the law of being useless if it just helps a selective group of startups over others while adding cost after cost for compliance. Absurd. There needs to be a better way to assist American startups and young entrepreneurs. I hope you consider that truth.
The Securities Act of 1933 carried a burden of compliance well beyond the means of most small companies for so very long. The Securities Act would have required intermediaries, like Kickstarter or Indiegogo, to register as brokers. I thank you and the American public for not allowing that to happen. As Congressman David Schweikert writes, "Small businesses and intermediaries could not afford to go down that path in search of capital."
Here, here.
Lastly, advertising an offering should be allowed in some fair capacity and maybe perhaps in a limited way. Still, in the scope of using social networking to help spread the message, it should be allowed. Social networking has been such a part of American business for a very long time and is the tool that helped save many of them since 2010. It should be strongly considered.
I appreciate your concentrated effort to get this LAW defined and moving forward so MANY of us can also do the same. Just please DO NOT allow the American inventor, entrepreneur or small businesses in this country to be left behind or let down by waiting years for this law to reveal nothing will change for them thanks to so many costs for compliance.
This LAW is the upgrade our country needed. It became law in 2012. So in 2014/15, let's define it with respect to all who worked so hard to bring it to this point. Keep it fair and low cost for ALL American startups.
Jumpstart...that word emphasizes the entire goal of this law and its final results.
Thank you, respectfully.