Mar. 6, 2020
To: Securities and Exchange Commission
Washington, D.C.
REF: Comments to Rule Making for File# S7-05-20
Facilitating Capital Formation and Expanding
Investment Opportunities by Improving Access
to Capital in Private Markets.
March. 6th. 2020
We thank SEC and Chairman Clyton to considering
to increase the maximum allowed funding from
$1,070,000 to $ 5 Million, and to reversing the
"whichever is lesser" to back as Congress originally
intended in HR3606 Title III to, "whichever is more",
regarding yearly income v/s networth.
However we still advocating to increase the maximum
allowed "crowdfunded stockholders" from the current
500 to 2,500, to make Regulation Crowdfunding really
work.
For example, during the first full year of operation of
Regulation Crowdfunding, one of the most successful
portal (intermediary) had over 102,000 investor members.
(investors must stay with the same portal for a full year,
according to regulations). However, the average member
contributed only $400.oo USD for the whole year. NOT
very much! (we understand, the following years that
average improved somewhat)
If we do the math, $400 X 500 only adds up to $200,000 USD,
a long way even to the current $1,070,000, maximum allowed,
much-less to do a second offering a year later as the Act
permits it. We realize that with Accredited investors being
allowed unrestricted investment, will much improve
the chances to reach the maximum allowed under
Regulation Crowdfunding, but with the proposed increase,
once again, we will run out of "crowdfunded stockholders"
before the campaign reaches that $5 Million USD cap.
We appreciate if the Commission would include that important
change as well.
Respectfully submitted by,
T.W. Kennedy, BE
founder
Regulated Funding Portal Industry Association
Long Beach, California
membership@RFPIA.org