This post is produced by MicroVentures.
How familiar are you with general solicitation? Well, you better become an expert on it, because your deal flow is about to increase and will be coming from places you never expected. Did you know that in about three weeks, startups are going to be able to advertise that they are raising capital in newspapers, magazines, blogs, billboards, and even on Facebook and Twitter?
General solicitation is loosely defined as seeking interest from the public at large for an offering either through advertising or some type of mass communication. The Jumpstart Our Business Startups (JOBS) Act is a law intended to encourage funding of United States small businesses by easing various securities regulations. It passed with bipartisan support and was signed into law by President Barack Obama on April 5, 2012.
Why is any of this important to you? New rules are scheduled to go into effect September 23, 2013. One of the more noteworthy new rules is that issuers must verify purchasers are accredited investors. This means that if you invest in a startup that is soliciting its raise online, you will have to provide proof that you are an accredited investor. This would involve sending in two years of W2s and certifying your salary for the current year, sending in bank statements or proof of assets, or getting your CPA to verify your status.
MicroVentures, a registered broker/dealer, has raised over $20 million on its platform over the last two years. It has execution experience, adhere to securities regulations, and has always had a seamless process in place for angel investors to fund startups. MicroVentures’ broker/dealer model is unique in the startup funding ecosystem and provides investors with the ability to make educated investment decisions in a regulated environment.
To learn more about MicroVentures and become pre-qualified as an accredited investor, visit www.microventures.com.
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