Subject: SEC Regulatory Initiatives Under the JOBS Act: Title III Crowdfunding
From: Brian Knight
Affiliation: CrowdCheck

December 5, 2012

Dear Ms. Bham and Mr. Blass,

I understand the SEC is looking for estimates of the universe of companies who may pursue investment crowdfunding. While there is a very limited amount of information available, and what information exists is often widely divergent, we found the National Small Business Associations 2012 Small Business Access to Capital survey ( to be useful.

According to that survey approximately 19% of small business owners are more likely to consider seeking investment due to the crowdfunding exemption of the JOBS act. Whether that number remains accurate as time has gone on and crowdfunding has gained more salience in the minds of the American public is debatable.

When we applied that to the approximately 6.5 million private firms in the US with employees1, and assumed both that the number of companies would continue to increase by about 3.45% per year and that about half of the 19% expressing interest made good over three years we got to about 700,000 companies in the third year of investment crowdfunding.

Obviously this model contains huge assumptions about rates of growth and investment crowdfunding adoption and will hopefully be subsumed by better emerging data, but we used it as a starting point. I hope you find this useful. If I can be of any further help please let me know.



Brian Knight
V.P. for Platform Services

1We got this number by looking at the most current U.S. Census data (2009) and applying a yearly growth rate of 3.45% based on the growth rate from 2003-2009 for the years 2010-2013.