New York (HedgeCo.Net) – The SEC has announced that today it will finally vote on the newly proposed crowdfunding legislation that allows a wider pool of small investors fewer restrictions when it comes to buying up modest amounts of equity in new businesses.
Hedge funds would be included under the new exemption as being allowed to solicit small investments from the general public over the Internet.
“Mandated by the Jumpstart Our Business Startups Act signed last March, the change is meant to free up more capital for entrepreneurs and spur more investments in promising young companies.” The Washington Post reports.
The first big push towards a crowdfunding exemption came in April 2010, when Paul Spinrad of Make Magazine, Jenny Kassan of the Sustainable Economies Law Center (SELC), and Danae Ringelmann of Indiegogo launched the Crowdfunding Campaign to Change Crowdfunding Law.
“If adopted by the five-member SEC, the rule would be a major shift in how small U.S. companies can raise money in the private securities market. The crowdfunding rule would let small businesses raise more than $1 million a year by tapping unaccredited investors.” Reuters says.
Story to be updated as information becomes available.
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