As the founder of a startup, one of the first issues you need to address is how to finance your company’s operations. If you are lucky enough to be able to fund your startup out-of-pocket, or through generous family members, congratulations. You can probably skip the rest of this post and get back to building your business. However, if you are like most founders, you won’t be able to self-fund your company entirely and your revenues won’t exist yet, or won’t be adequate to grow the company. In some instances you may be able to obtain or if you have some type of hard asset or significant ac
. . . → Read More: Financing Your Startup: How to Sell Stock without Going to Jail
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Washington, D.C. (Press Release – September 15, 2011) – Small Business & Entrepreneurship Council (SBE Council) member and entrepreneur Sherwood “Woodie” Neiss brings his Crowd Fund Investing (CFI) framework to a congressional hearing today, where there is growing support to modernize outdated security laws that prevent small business owners from tapping into their networks for raising capital. Today, the U.S. House Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs is hosting “Crowdfunding: Connecting Investors and Job Creators” where they will hear from Nei Q: Say I have an angel (SEC accredited) who’s ready to invest at an amount well below $100k. How would this impact on a future round with VCs? Is there some standard or average pre-money and post-money that happens in angel deals? Also, the angel in question is a family member of a friend, so would it be better to have them invest as a family/friend financier rather than an angel, and how exactly would that work? A: (Brad) Let me address the last question first. There is no real difference between a “family/friend” investor and an “angel” investor other than semantics. Structurally…. Similar topics at:  Family and Friends, Selling Stock -- SEC Rules, Valuation  accredited investor, sec There is a simple legal answer to your question: this type of behavior that you and your colleague are discussing is an illegal solicitation under th When you acquire restricted securities or hold control securities, you must find an exemption from the SEC’s registration requirements to sell them Regardless of the source of your financing–family and friends, angels, or venture capital–you will need some vehicle, forms, or set of papers to ma The Federal Securities Act of 1933 generally requires that stock and other securities must be registered with the Securities and Exchange Commission When you acquire restricted securities or hold control securities, you must find an exemption from the SEC’s registration requirements to sell them For most entrepreneurs, the best vehicle to accomplish initial equity financing under an exemption is through the use of Regulation D, which is a lim We are now going to look at some of the rules and types of offerings a company can make. From the point of view of a company issuing stock, the most |
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