What will crowd funding do for start-ups?… continued…

So our last post, I was a little distracted I admit.  But I know those of you who checked, the offices are pretty fantastic…

So anyway to give everyone a brief description of history…

Since the early 1930s the financial realm has been largely regulated by the government especially when it comes to companies raising money to grow.  The logic for this is to protect the ‘unsophisticated’ investor from charlatans and scam artists.  As much as it sounds like a noble duty, I would be kind of offended if I heard that.  It’s like someone telling you you’re not smart enough to make your own judgements when it comes to investments.  HOWEVER, you are allowed to gamble all of your money away, make irresponsible decisions when it comes to enormous home mortgages, take out more credit card debt than you can handle….all while you make less that $25,000 / year.

So that’s that.  The government made the disclosure and reporting requirements for a company to ‘generally solicit’ the public (basically ask more than one person at a time) to provide investments that is is generally cost prohibitive and is not really an option.

Then enters the internet age.

Everything was done through the power of the masses.

Everything was and is being done in the crowd(cloud), pun intended.

So why not the investments ? That’s what we are scratching our heads about too…

 

The House of Representatives nearly unanimously voted in HR. 2930 permitting crowd funding of investments for companies.  Then held up in Senate.  What a surprise…. It is an election year right??  Even the permissive legislation is by no means a carte blanche, but a rather cautious approach in permitting the public to effectively choose their own fate in the future by supporting the start-ups which they want to support.  Sounds like a crazy idea if you ask me….

 

 

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