• Regulations & Compliance

Is a FINRA-regulated funding portal necessary to do a crowdfunding raise?

2 Answers, 0 Replies
Brian Belley
November 3,
Brian Belley  replied:
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Brian Belley
November 3,
Brian Belley  replied:

The short answer is: yes, Regulation Crowdfunding requires that an issuer uses a crowdfunding intermediary.

I'm assuming when you say "crowdfunding raise" that you're referral to using Regulation Crowdfunding (Reg CF). Reg CF legally requires the use of a crowdfunding intermediary, which can be either a funding portal, or a registered broker-dealer. 

There are other types of securities-based "crowdfunding" - e.g. if you're looking to do a larger Reg A+ raise, then you are not required to use a crowdfunding intermediary - some issuers will do these campaigns on their own website. However, Reg A+ campaigns have much higher costs to launch due to more stringent disclosures and other legal and financial requirements.

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