The US Securities and Exchange Commission (SEC) will revoke the ban on unlisted companies from advertising for investment on the 23rd. After the 80-year ban is lifted, new ventures can raise funds through various advertising methods, which will inevitably lead to a crowdfunding boom.
According to the current law, unless there are a few exceptions, only companies that register with the SEC can advertise for fundraising, with a few exceptions. However, last year, Congress passed the Promotion of Venture Capital Law (JOBS) to open up corporate advertising to the public. However, in the early days, only the prospective enterprises accepted the funds of the recognized investors. Only next year, they can accept the funds of all investors and give the industry to raise funds by the people. Legal space.
This kind of financing is a part of the so-called shadow banking system and is also being carried out around the world. After the financial turmoil, it was not easy to borrow from traditional financial institutions, and the crowdfunding continued to expand in the United States.
The Wall Street Journal pointed out that so far, crowdfunding is still limited to a platform like Kickstarter, which does not become a shareholder or share profits. For example, fans who invest money to support a certain director to rely on the crowd to raise money for filming can not share profits, and can only be satisfied from the film works that sponsor their approval.
EquityNet operator Horas, an online platform for intermediary investors and entrepreneurs, said: “This is the most intense and creative capitalism and financial change in 80 years. ” Without advertising, EquityNet was established in 2005 to help raise $200 million. He said that in the United States, there are millions of investors involved in crowdfunding platforms like Equity Net, which can now reach 50 million. He estimates that the investment funds can reach 5 trillion US dollars.
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