Subject: File No. JOBS Act Title III
From: William J Mills, JD
Affiliation: BeFounders

April 24, 2012

Current SROs, such as FINRA, require the principals of its members to pass the Series 7. However, this requirement would block the ability of numerous entrepreneurs who seek to create funding portals. It will have a chilling effect on entrepreneurs who wish to start a funding portal and will thus destroy innovation in this nascent space. At the least, it will significantly delay the ability of entrepreneurs to launch their funding portals.

If the principals of funding portals are required to pass the Series 7, it may only serve to shift the formal titles of founders to demote non-Series 7 members. The end result will be the same as simply not requiring funding portals to have principals that hold the Series 7.

Because the Series 7 requires the sponsorship of a FINRA member firm or an SRO, the new crowd investment industry would become dominated by people who are already members of the established financial industry. Valuable innovations from entrepreneurs outside of the financial industry will be lost. The financial industry will have sufficient advantages without a Series 7 requirement.

Obtaining the Series 7 is required in order to become a broker-dealer. However, in the JOBS Act, Congress shows a clear intent to separate broker-dealers from funding portals. This Congressional intent should be used as the legal basis to not require principals to pass the Series 7.

The conclusion of my arguments is that whatever SRO governs the crowd investment industry should not be required by the SEC to restrict its membership to funding portals that have principals who have passed the Series 7.

Billy Joe Mills