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As a native of Silicon Valley , I’ve witnessed the creative destruction of wave after wave of innovation as nearby corporate campuses repopulated themselves : From defense contractors to data centers , computer mainframe manufacturers to Internet search engines. Intellectual Property. Free Speech.
These are all accreditedinvestors who risk their own money. As an active angel investor myself, I understand how the process works, and I see the disappointment in the eyes of entrepreneurs who approach angel groups for funding and often get turned away for not being timely or prepared in the minds of potential investors.
Many entrepreneurs seems to be convinced that the “crowd” of regular people using the Internet will somehow solve their startup funding needs, when they sense a lack of interest from accreditedinvestors. When pitching to consumers, online or offline, the feedback will likely be on features and design.
Many entrepreneurs seems to be convinced that the “crowd” of regular people using the Internet will somehow solve their startup funding needs, when they sense a lack of interest from accreditedinvestors. When pitching to consumers, online or offline, the feedback will likely be on features and design.
This is a term indicating the use of “crowd appeal” to get money from interested people on the Internet for a share of your company. Sites like KickStarter have for years offered rewards and pre-sales for crowd investments, but real equity won’t be legalized until sometime this year for people other than accreditedinvestors.
Many entrepreneurs seems to be convinced that the “crowd” of regular people using the Internet will somehow solve their startup funding needs, when they sense a lack of interest from accreditedinvestors. When pitching to consumers, online or offline, the feedback will likely be on features and design.
Most are somewhere in between, focusing primarily on early-stage, high-growth companies with scalable businessmodels. These are typically Internet-enabled, or consumer products, or medical devices. Benefits of joining a group include pooling deal flow, capital, domain expertise, and investing experience.
I wont go into the details of the bill, but at a high level, it allows entrepreneurs to raise funds over the Internet up to a maximum of $1M annually (or $2M with audited financials). Maximum investment from each individual investor would be the lesser of $10K or 10% of annual income and investors do not need to be sophisticated.
The Internet has made it easier for individuals and organizations to raise money for charitable purposes, political campaigns, artists seeking support from fans and various other projects. As a result, current crowdfunding platforms have generally developed businessmodels designed to avoid characterization as a sale of a security.
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