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SEC Lifts Ban on General Solicitation: New Rules to Allow Startups to Advertise for Financing
In a historic and long awaited move, the SEC voted 4-1 to implement regulations under Title II of the JOBS Act to lift the 80 year old ban on general solicitation for securities offerings and bringing the securities industry into the internet age. This means that around late September companies will be able to generally advertise their securities offerings, so long as all the purchasers of these securities are Accredited Investors.
Imagine raising $1,000 each from 1,000 investors scattered around the country using advertising combined with an online platform. This will soon be possible!
To use these new rules, however, Companies will be required jump through additional legal hoops, including having to verify the accreditation of their investors by checking tax returns, W-2s or getting certifications from a broker-dealer, lawyer or CPA with personal knowledge.
Companies may also be required to make a filing with the SEC 15 days BEFORE any advertising takes place and they also be required to file all of their advertising material with the SEC. The penalties for violating these rules are severe, including being barred from raising additional funds using Rule 506 for a full year.
In this panel, we'll walk through the new rules and the proposed rules and discuss how you can best position your company to raise financing in this new era.
5:30 - 6:00 pm: TiE Angels Information Session (Entrepreneurs Only)
6:00 - 7:00 pm: Networking, Cocktails & Snacks
7:00pm - 8:00 pm: Panel Discussion
Kiran Lingam, General Counsel, SeedInvest
Stephen Davis, Partner, Goodwin Procter
Shai Goldman, Venture Partner, 500Startups
Jeffrey Stewart, CEO and Co-Founder, Lenddo
***WARNING: Do not advertise yet. You cannot advertise until September 23. Please consult your attorney prior to taking any action that may affect your rights.