The lifting ban on general solicitation in mid 2013 by the Securities and Exchange Commission (SEC), recorded a positive era in equity crowdfunding in business development throughout 2014.
$5 Billion Gains in Equity Crowdfunding
Nearly $5 billion gains in equity crowdfunding was projected in 2013. This was double what was estimated in 2012. The gains made by the Jobs Act cannot be overemphasized.
Many startups and some entrepreneurs have raised thousands of dollars from various investors. They have been able to launch capital driven investment projects through equity crowdfunding resources. This impact is anticipated to add to the nation’s job numbers in the coming years.
The New Campaign
Institutions founded to provide insight and advocacy to equity crowdfunding as described in the Jobs Act have continued to strengthen their platforms. Institutions like the the National Crowdfunding Association, Crowd Funding Professional Association, Pave and Upstart have dominated education and advocacy in equity crowdfunding.
In the past, institutions that take a cut of the capital they raise in investment now face a fierce competition. The new crusade allows startups to publicly solicit for equity crowd-funding from willing investors. This provides a wide net for capital for start-ups and entrepreneurs.
Those who oppose the equity crowdfunding bill have genuine reasons. Their concerns should prompt law makers to continue to protect startups and entrepreneurs against seemingly fraud in the investment market.
But so far, its implementation continues to help a great number of startups and entrepreneurs. It has been reported that a single investor continues to make over $2.1 million in equity crowdfunding offers to over 160 people since last year. About half of this number are business oriented individuals starting a new journey in equity crowdfunding capitalism.
Prospects for 2015
As of December 26, 2014 however, news released by the SEC concerning equity crowdfunding might slow down some gains made.
The SEC plans to to complete Title III of the Jobs Act by October 2015. This title represents the equity crowdfunding rule. The rule also requires 60 days to be published in federal register to become law.
This means that, the earliest small businesses could take advantage of this provision to raise equity crowdfunding capital for their businesses will be in 2016.
Ceiimages is of the view, that it is in the interest of the economy for law makers to ensure a careful, but speedy process of this transition; so as to protect and help finance small businesses on time and meaningfully in 2015 and beyond.