Can transfer agents save democracy?

A long time ago in what seems like a different universe, I was working on an IPO for a company that will have to remain unidentified in a country that never experienced Enlightenment thinking. The company’s CEO and majority owner decided to challenge the local dictator’s political leadership. Dictator X didn’t take kindly to that […]

Raising funds under Reg CF for acquisitions

There’s an interesting contrast between Regulation A and Regulation CF in terms of disclosure. Reg A requires that issuers provide financial statements for “businesses acquired or to be acquired.” Even if that’s not what the money is being raised for. If you just acquired, or are probably going to acquire, a business (and it doesn’t […]

Why Reg S doesn’t work with online offerings

Anyone who knows me knows my link with the SEC’s Regulation S. While folks sometimes refer to it as an exemption from registration under the Securities Act, it’s not. Reg S provides that the registration provisions of the Securities Act simply do not apply to offers and sales made outside the United States, and then […]

Subsidiaries using Reg CF

This came up no less than three times last week, so I figured it was worth a blog post. Subsidiaries can raise funds under Reg CF, even if they are subsidiaries of companies who cannot use Reg CF themselves, because they have a class of securities registered with the SEC, or they are not US […]

Why Reg CF doesn’t work for many VC-backed companies

Since the increase in the maximum offering amount to $5 million a couple of years ago, we’ve seen more interest in Reg CF offerings by venture-backed companies. Sadly, it doesn’t work for a lot of them. This is because of what we refer to as the “issuer aggregation rule”. Rule 100(c) explains that “issuer” for […]

I’m crowdfunding. Do I really need a transfer agent?

We keep hearing this question. To be honest, it’s not clear why a crowdfunding issuer would want to have to deal with the recordkeeping for what could be thousands of investors (and even if the issuer uses a Reg CF SPV, that itself is an issuer whose many shareholders have to be wrangled). But are […]

Considerations in doing a Reg CF offering….

Companies often wonder, does it make sense to do a Reg CF offering rather than a Reg A offering? Keep in mind that although selling securities using Reg CF may at first blush seem faster, cheaper and may have some advantages for marketing purposes, it is not always an easy calculation to make. There are […]

More evidence the SEC is looking more closely at Regulation A

We are often asked by companies, “why can’t I do [fill in the blank]? I see this other company doing it.” Our response has always been that just because those other companies have not yet been subject to enforcement, doesn’t mean that there will not be an issue later on. The time and effort to […]