OSC Staff Consultation Paper 45-‐710 Consideration

On December 14, 2012, the Ontario Securities Commission (OSC) published the OSC Staff Consultation Paper 45-710 Considerations for New Capital Raising Prospectus Exemptions. The Consultation Paper sets out four concept ideas for new prospectus exemptions in Ontario, together with a number of specific consultation questions. The concept ideas are: a concept for an exemption to allow crowdfunding subject to limits for issuers and retail investors, a concept for an offering memorandum exemption, a concept for an exemption based on an investor’s investment knowledge, and a concept for an exemption based on an investor receiving advice from a registrant.

Wales Capital participated in a forum along with other industry thought leaders such as Crowdfund Capital Advisors, SomoLend, Arctic Island, GATE Technologies, Nehemiah Investments, and Ellenoff Grossman & Schole, LLP.

Subsequently, Wales Capital provided comment letters to the OSC for consideration as related to a). Investment Size; b). Oversubscription; c). Two Business Day “cooling period”; d). Revenue Models; e). Rescission Period (Withdrawal Rights).

Read Comment Letters Here

Top 10 Most Influential in Equity Crowdfunding

Top 10 Most Influential in Equity Crowdfunding (via SBWire)

Omaha, NE — (SBWIRE) — 03/29/2013 — As Equity Crowdfunding is sitting at a standstill it will take an army of people to keep the momentum moving forward to get the laws passed and everyone on the same page. Equity Crowdfunding is coming up almost a year since the signing of the JOBS Act by president…

CfPA Launches Global Education Network

By: Rob Stott

Still in its infancy, the Crowdfunding Professional Association relied on the expertise of its founders and the skills of its staff to get an online education network successfully off the ground. The goal: to meet the needs of a rapidly emerging industry.

In an industry that seems to be growing and changing by the hour—thanks, in part, to the 2012 JOBS (Jumpstart Our Business Startups) Act—a new associations is moving quickly to help crowdfunding professionals, industry partners, investors, and the general public make sense of it all.

The Crowdfunding Professional Association announced that it is rolling out a Global Crowdfunding Education Network that will provide online resources including breaking news alerts, legislative updates, and crowdfunding classes to professionals in the industry and others interested in learning more about it.

The network is “built to help prepare and educate investors and entrepreneurs for the implementation of Title II and Title III crowdfunding,” the group said in a statement, referring to two sections of the JOBS Act that provide for funding mechanisms for startup businesses.

“The CfPA was founded under the principles of education, advocacy, and awareness at the global industry level for crowdfunding,” said Kim Wales, chair of the CfPA and founder of Wales Capital. “Our real mission is to make sure the entrepreneurs have a place that they can tap into mentorship, build relationships, and build partnerships.”

To launch the website after being formed just last year, CfPA relied on the expertise of its founders, many of whom played a role in creating the framework for the JOBS Act, Wales said. “We’ve taken their approach to create standards, best practices, and guidelines. That’s really what is going to make up the foundation in terms of being able to scale something long term,” she said.

CfPA is getting help from outside sources as well.

“We’re involving the third-party providers, the vendors, the professional service providers, people that are going to be really instrumental in making this process run smoothly, diligently, and transparently,” said Scott McIntyre, cochair of the founding executive committee for education and training, and managing director of Phabriq. “We have to make sure that we’re covering angles that everybody gets.”

Ensuring that the education network was properly designed and marketed meant putting key players throughout the organization in roles that worked to their strengths.

“It has to be organic,” said Wales. “You can’t really force the pieces. The organization is not created on a single person, and it is not created under the view of an individual company. It is a collective view, and that’s for the industry.”

Using the staff’s existing networks and properly promoting the program have been important tactics as well, something McIntyre said other groups can learn from.

“Find the workforce, the people that are going to spread the word voraciously,” he said. “You can have the best idea, the best pitch, or the best website, but if you don’t have a network of people that are following you, that are connected to you, then you are a tree in the forest and no one’s going to hear you fall. Networking is absolutely paramount to any business and is a very valuable asset, one that we cannot undersell.”

Association Now Website: associationsnow.com/2013/02/higher-ed-crowdfunding…network

Bloomberg talks Crowdfunding with Kim Wales

Feb. 19 (Bloomberg) — On today’s “Money Moves,” Bloomberg Television focuses on alternative assets and places where investors are investing their money outside of the traditional stock and bond markets. Live with Kim Wales, the founder of Wales Capital, a strategic business advisory firm and Candace Klein, founder of SomoLend, a debt based crowdfunding platform.

Kim is the Chair of the Crowdfunding Professional Association (www.cfpa.org).  Candace Klein is the Co-Chair of the Crowdfund Intermediary Regulatory Advocates (www.cfira.org)

(Source: Bloomberg)

Watch live:

Jason Best at TEDx San Miguel de Allende on Crowdfund Investing

Published on Jan 7, 2013

Jason Best, one of the innovators of the crowdfunding model,
investigates why it has been so successful and suggests ways that it
will transform entrepreneurial endeavors in the future, thus
facilitating a new wave of startups and technologies.

http://www.youtube.com/watch?v=uI_5a7jG7Ss&feature=youtu.be&goback=%252Egde_4615069_member_208953938

FINRA and the SEC Move One Step Closer to JOBS Act Implementation

Washington, D.C. (PRWEB) January 31, 2013

FINRA’s information request brings optimism to the crowdfunding industry’s leading trade organizations CFIRA and CfPA.

The Crowdfund Intermediary Regulatory Advocates (CFIRA) and sister organization the Crowdfunding Professional Association(CfPA) have conducted a thorough review of the FINRA Registration Process Inquiry form for Crowdfunding Portals, and are optimistic about the progress that is being made toward the implementation of Title II and Title III Crowdfund Investing.

Rep. Patrick McHenry on the Benefits of “Crowdfunding” in Davos

At the World Economic Forum 2013 in Davos, Switzerland, Rep. Patrick McHenry (R., N.C.) talks with Neil Lipschultz at Davos about “Crowdfunding” and the future of the JOBS Act, aimed to help small and emerging businesses attract financing.

Rep. Patrick McHenry on Crowdfunding and the JOBS Act in WEF Davos, Switzerland

Calculating the odds: Crowdfund Investing

Kim Wales writes about the regulatory decisions looming for the JOBS Act and how instead of imposing heavy regulations that are likely to confuse the U.S. states and EU nations states; government should look at criteria for Intermediaries such as operational and financial transparency, security of information and payments, platform functionality and customer protection.

Read the article in the Cayman Financial Review Magazine

 

Goldman Sachs 10K Small Businesses Funders Panel adds Crowdfunding

On January 25, 2013 Goldman Sachs and LaGuardia College hosted its 7th, 10,000 Small Businesses Funders Panel and invited Kim Wales, the founder of Wales Capital, a thought leader in Crowdfund Investing as a panelist.

Goldman Sachs 10,000 Small Businesses is a five-year initiative to unlock the growth and job creation potential of 10,000 small businesses across the United States through greater access to business education, financial capital, and business support services. The initiative is currently active in New York City, the greater Los Angeles area, the greater New Orleans area, and Houston, and will expand to communities across the country.

Objectives

10,000 Small Businesses is designed to help firms grow and create jobs. Small businesses play a vital role in creating jobs and growth in America’s economy and during the past 40 years, small businesses have created two-thirds of the net new jobs in the country. According to the National Federation of Independent Business (NFIB) and other research, these businesses are essential assets for the communities in which they operate.

Eligible Small Businesses

The program is designed for underserved small businesses which have the potential to grow. Broad characteristics of qualifying business owners include, but are not limited to: business revenues between $150,000 to $4 million in the most recent fiscal year; in operation for at least two years; at least four full-time employees; operations in economically disadvantaged areas; and a business model that can scale to create more jobs NYC Business Express. An online source, NYC.gov/BusinessExpress, takes the edge off of obtaining licenses, permits and certifi cations. At this continually updated website, entrepreneurs can fi nd step-by-step instructions for meeting all of those pesky government requirements. — Phyllis Furman

For more information,  Goldman Sachs 10,000 Small Businesses

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‘Crowdfunding’ Rules Are Unlikely to Meet Deadline

By ROBB MANDELBAUM

When the Jobs Act became law in April, supporters proclaimed a new era for small businesses seeking to raise money.

The “game changer,” as President Obama put it in the Rose Garden as he signed the bill, was a provision to let small companies “crowdfund” — that is, sell stock and other securities over the Internet directly to the public. “For the first time,” the president said, “ordinary Americans will be able to go online and invest in entrepreneurs that they believe in.”

But it now seems that dawn will break late on this new age of democratic investing. The Securities and Exchange Commission appears certain to miss its end-of-year deadline for issuing regulations to put the provision into effect. And with the departure of the S.E.C. chairwoman, Mary L. Schapiro, and three of her top deputies — including two who manage the offices writing the regulations — some in the nascent equity crowdfunding industry worry that it could be 2014 before their line of business becomes legal.

The delay has frustrated many crowdfunding backers. The 270 days that Congress gave the S.E.C. to write the rules “is not a suggested timeline; it is a Congressional mandate,” said Kim Wales, an organizer at Crowdfund Intermediary Regulatory Advocates, a lobbying group formed in April to represent the new industry, in an e-mailed statement. “The S.E.C. answers to Congress, not the other way around.”

Read more…
 
Originally published in the New York Times on December 27, 2012
http://www.nytimes.com/2012/12/27/business/smallbusiness/why-the-sec-is-likely-to-miss-its-deadline-to-write-crowdfunding-rules.html