To become a crowdfunding funding portal under the JOBS Act, an entity must register with the Securities and Exchange Commission (SEC) as a "funding portal" and comply with certain regulatory requirements. Here are some of the key requirements:

1: Registration: The entity must register with the SEC as a funding portal by filing Form Funding Portal and must become a member of a national securities association (currently FINRA - the only game in town). Form Funding Portal requires information from the funding portal applicant, including information about the funding portal's business, principals, control relationships, and employees. See: https://www.sec.gov/tm/divisionsmarketregtmcompliancefpregistrationguidehtm

2: Restrictions on Activities: Funding portals are limited in the types of activities they can engage in. For example, they are prohibited from offering investment advice, soliciting transactions, or handling investor funds or securities. They may provide limited communication channels for issuers to communicate with potential investors, but all communication must be conducted through the portal and must be accessible to all investors. IMHO, some restrictions may be tighter than they should be given the capabilities of harnessing the crowd with technology.

3: Investor Protection: Funding portals must take steps to protect investors, including verifying the identity of each investor and limiting the amount of money each investor can invest in a given offering. They must also provide investors with educational materials and warnings about the risks of investing in crowdfunding offerings. It's important to remind investors at every turn that investing is risky - and they can lose all of their investment. Unlike the world of crypto where FOMO is the key selling point, this is REGULATED INVESTMENT CROWDFUNDING so education, disclosures, and caution is warranted.  

4: Disclosure Requirements: Funding portals must provide certain disclosures to investors, including information about the issuer, the terms of the offering, and the risks involved in investing in the offering. They must also provide ongoing updates about the issuer and the offering. When in doubt, build disclosures throughout your platform's workflow.

5: Record keeping and Reporting: Funding portals must maintain records of all transactions conducted through the portal and provide certain reports to the SEC.

Compliance with these requirements is essential for a crowdfunding funding portal to operate legally under the JOBS Act. It is important to note that these requirements may be subject to change as the SEC continues to learn from the experience of industry stakeholders and develop its regulatory framework for crowdfunding offerings.

n...@...l 

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Yes, Regulation A+ (Reg A+) was introduced as part of the Jumpstart Our Business Startups (JOBS) Act, which was signed into law in 2012. The JOBS Act was designed to make it easier for small businesses and startups to access capital and grow their businesses by easing some of the regulatory burdens and costs associated with raising capital.

Reg A+ is an enhanced version of the existing Regulation A offering, which was first introduced in the 1930s. Reg A+ expands the scope of the existing Regulation A by allowing companies to raise up to $75 million in a 12-month period from both accredited and non-accredited investors, as compared to the previous limit of $50 million. It also streamlines the offering process, allows for ongoing reporting requirements, and provides preemption of state securities laws.

Reg A+ was intended to provide a more flexible and accessible fundraising option for small and medium-sized businesses, while also providing investors with greater access to investment opportunities. By allowing companies to raise larger amounts of capital from a wider pool of investors, Reg A+ is seen as a way to foster innovation, create jobs, and stimulate economic growth.

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Unless the portal is a licensed broker-dealer, it may not offer investment advice or recommendations or solicit purchases, sales, or offers to buy the securities offered or displayed on its platform.

It may however apply objective criteria to highlight offerings on its platform where: 

(i) The criteria are reasonably designed to highlight a broad selection of issuers offering securities through the funding portal’s platform, are applied consistently to all issuers and offerings and are clearly displayed on the funding portal’s platform; 

(ii) The criteria may include, among other things, the type of securities being offered (for example, common stock, preferred stock or debt securities); the geographic location of the issuer; the industry or business segment of the issuer; the number or amount of investment commitments made, progress in meeting the issuer’s target offering amount or, if applicable, the maximum offering amount; and the minimum or maximum investment amount; provided that the funding portal may not highlight an issuer or offering based on the advisability of investing in the issuer or its offering; and 

(iii) The funding portal does not receive special or additional compensations for highlighting one or more issuers or offerings on its platform.

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A SAFE is an investment vehicle which allows investors to invest in a company in exchange for the future equity it holds. Similar to a stock option, it is commonly used within the context of investment crowdfunding.

Stock option agreements and safe instruments used in crowdfunding are similar in that they both provide investors with a way to invest in a company without having to purchase shares of stock. They both provide investors with a way to invest in a company without having to take on the risk of owning shares of stock.

They also both provide investors with a way to invest in a company without having to pay the full price of the stock.

However, the main difference between the two is that stock option agreements provide investors with the right to purchase shares of stock at a predetermined price, while safe instruments provide investors with the right to receive a predetermined amount of money if the company is successful.

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506(b) offerings are not typically considered to be a form of crowdfunding. Crowdfunding generally refers to a method of raising funds from a large number of people, often through online platforms, in exchange for equity or other forms of compensation.

506(b) offerings, on the other hand, are private placements that are typically offered to a limited number of accredited investors. While crowdfunding can also be used to raise funds from accredited investors, it often involves a much larger number of investors who may not meet the SEC's accreditation requirements.

However, it's worth noting that some online platforms have emerged that allow companies to conduct 506(b) offerings through crowdfunding-like platforms. These platforms typically provide tools and services to help companies comply with the SEC's regulations regarding private placements and may allow companies to market their offerings to a broader range of accredited investors. These types of platforms are sometimes referred to as "accredited crowdfunding" or "equity crowdfunding for accredited investors."

Overall, while there are some similarities between 506(b) offerings and crowdfunding, they are typically considered to be distinct methods of raising capital, with different regulatory requirements and target audiences.

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Thanks for the great question. With nearly 90 FINRA regulated funding portals and thousands of broker dealers all eligible to facilitate issuers for their crowdfunding raises, you aren't alone in looking for deals that meet certain characteristics (e.g. impact investments). Luckily, there do exist aggregators that collect data about live offerings and sort them into categories. 

KingsCrowd is one such aggregator and you can find companies with live offerings that they've sorted as having "Social Impact" by clicking on this link: https://kingscrowd.com/companies/search/?social_impact=true&status=Active I believe they have a team of analysts that tag issuers with certain labels to make them easier to sort. 

Another place where you can learn more generally about companies operating at the intersection of impact investing and crowdfunding is at the SuperCrowd conference where companies, including impact companies with live offerings, pitch, present, and discuss case studies. It's a major gathering of leaders in this sector and you can find more info here: https://thesupercrowd.com

#impactinvesting #socialimpact @Devin Thorpe @Brian Belley 

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Crowdfunding in Africa is in its infancy stage of development. Just like in the U.S., donation and reward-based crowdfunding has been trying to take hold in the market for the last several years. That said, equity crowdfunding is springing around since 2015/16 with its potential being recognized by governments and the development/donor community including ours (https://igniteinvestment.com/) launched in September 2022. 

With over 80% of African businesses being Small and Medium Enterprises (SMEs) facing a critical lack of access to finance because of collateralized debt financing, the potential for crowdfunding is estimated to reach over 2 Billion in sub-Sahara Africa by just 2025. I also know that Wefunder and Republic have been eyeing around the African equity crowdfunding market. In fact, I actually participated in one of Republic's Twitter spaces event talking about how African company fundraised on their platform.

Hope this help and have a look at these two articles that may give you some more information: https://www.un.org/africarenewal/magazine/july-2022/crowdfunding-emerging-financing-source-african-entrepreneurs#:~:text=Forecasts%20now%20show%20that%20crowdfunding,cent%20of%20the%20global%20market. 

https://link.springer.com/chapter/10.1007/978-3-030-46309-0_14 

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The Commission should examine ways to expand their access to capital, but it should do so in a way that mitigates the risks posed by offering investors fewer or no protections.
The author of this statement has a critical attitude towards private market access. They argue that retail investors lack the bargaining power and resources to access the same investments as venture capitalists, and they caution against expanding market access without better protections for investors. They ultimately advocate for increased access to capital, but argue that it must be done in a way that reduces risk for investors. less

VCs, or venture capitalists, are considered gatekeepers because they play a significant role in determining which startups and entrepreneurs receive funding and support. VCs typically have significant financial resources and expertise in evaluating the potential success of new businesses.

Startups often rely on funding from VCs to get their businesses off the ground and to scale their operations. VCs are known for providing more than just financial support, often offering advice, guidance, and mentorship to the entrepreneurs they fund.

Because of their significant role in the startup ecosystem, VCs have the power to act as gatekeepers, controlling access to funding and resources that can be crucial to the success of a startup. This means that entrepreneurs may need to meet certain criteria, such as having a certain level of experience or connections, in order to gain access to VC funding.

Additionally, VCs often prioritize investments in certain industries or types of startups, which can further limit access to funding for entrepreneurs in other sectors or with different business models. This has led to criticism that VCs may not always invest in the most innovative or diverse startups, and may instead favor those that fit within their existing investment strategies and portfolios.

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