Investor Crowdfunding under Reg CF
See also
Raising Capital with Reg CF Done Properly
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Run a self-hosted capital raise on our platform to build your brand and attract prospective investors without fear of losing them to other deals.
Non-voting
Our established framework guarantees that a multitude of initial investors do not impose undue pressure on the company, while also enabling founders to maintain control pre and post-conversion.
12(g) Exempt
By utilizing our registered Transfer Agent services, issuers can receive exemption from supplementary reporting obligations for their Reg CF, under 12(g), while their total assets remain below $25 million.
Founder Friendly
Regulation CF investors are organized into one entry/share class within your cap table both before and after conversion. The ongoing management of shareholders is expertly overseen by the Transfer Agent.
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Frequently Asked Questions
What is Regulation Crowdfunding?
Regulation Crowdfunding enables eligible companies to offer and sell securities through crowdfunding. The rules:
- require all transactions under Regulation Crowdfunding to take place online through an SEC-registered intermediary, either a broker-dealer or a funding portal
- permit a company to raise a maximum aggregate amount of $5 million through crowdfunding offerings in a 12-month period
- limit the amount individual non-accredited investors can invest across all crowdfunding offerings in a 12-month period and
- require disclosure of information in filings with the Commission and to investors and the intermediary facilitating the offering
Securities purchased in a crowdfunding transaction generally cannot be resold for one year. Regulation Crowdfunding offerings are subject to “bad actor” disqualification provisions.
Limitations to Regulation CF offering in a calendar year
An entity is limited to one CF offering at any given period. The limitations associated with Regulation CF (“Reg CF”), relate only to your Reg CF deal and will not affect your ability to raise funds through a different exemption. Subject to compliance with integration rules, you can effectively run a crowdfunding raise concurrently with another approved raise, with overlap, or one immediately after the other.
In addition, there is a limit on how much can be raised by the company within a 12-month period, depending on your level of financial disclosure. For more information on the limit under a Reg CF, please refer to the SEC website.