SEC Proposes Crowdfunding Rules

The Securities and Exchange Commission finally released its proposed rule governing crowdfunding, but final approval is unlikely this year.

VCs still have concerns about incorporating hundreds or thousands of crowdfunded investors into the company’s capital structure. In response, funding portals have come up with potential solutions, like a security that allows venture capital firms to buy out investors at a certain multiple of their investment later on.

The SEC will accept comments on the proposed rules for the next 90 days. It will likely not release final rules until 2014.

For more on crowdfunding and the JOBS Act, see CFO‘s explainer.

Courtesy of Flickr user Rocío Lara. CC-BY SA

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