Newsletter: August 3, 2012
Here’s an eyewitness report from the SEC that David Drake received last week from a private meeting held with the SEC July 16, 2012.
On July 16, Founder of MicroAngles Mark Perlmutter had a private meeting at the SEC with 7 SEC lawyers invited by Special Counsel Tamara Brightwell who leads the team drafting rules.
Mark Perlmutter writes:
I shared experiences on three topics:
1 – Lessons learned from the leading crowd funders in Australia and Europe.
2 – How existing DPO laws are perfect for crowd funded startups.
3 – The California experience which allows advertising of intra-state private offerings.
I quoted statistics for Australian Small Scale Offering Board at 2,000 companies raised $125,000,000 in 7 years, with 86% still in business.
I said neither Australia or Europe had unusual fraud problems. So a very light touch on small raises up to $150k seemed appropriate for the US, with increased requirements for larger raises.
Then I explained that DPOs are the next logical funding round for crowd funded startups and showed prospectus examples of completed DPOs.
Several of the lawyers in the meeting eagerly thumbed through these as if they had never seen a DPO prospectus.
Then I talked about the California experience with seasoned law 25102 (n) allowing advertising of intra-state private offerings.
They asked more than 10 questions during my presentation and we ran out of time at the end of 60 minutes.
They thanked me as an interested industry professional for giving them real world data.
From their attentive listening and thoughtful questions, I believe my points will influence the rules they draft.
With luck, their bosses, the SEC Commissioners will accept their recommendations and this will lead to a healthy crowd funding sector.
- Mark Perlmutter, CEO MicroAngels
The US Commerce department delegation conducted a workshop and symposium in Brussels July 10, 2012. It gathered experts from the US and EU discussing topics of increasing Small and Medium-sized Enterprise access to capital formation, reduction in non-tariff costs and removal of red tape in a more competitive landscape. The US delegation was 10 strong with Mr. Drake joining as as an expert on the JOBS Act (Jumpstart Our Business Startups Act) plus 10 European representatives attended with an additional 10 EU Commission members. These members included the European Commission head, Daniel Crespo, Director General of the DG Enterprise and Industry at the European Commission (one of 27 pan-European industry focused Director General divisions – soon to be 28 member countries in August).
Some of the remaining 30 guests attending included Gordon Murray of Exeter Business school, Anne Glover of Amadeus Capital in London, Ella Van Gool from Square 1 Bank in San Francisco, Joseph Bartlett former Under Secretary of the US Commerce department, Sven Wieber formerly of Silicon Valley Bank, Karen Wilson of OECD, James Burnham for the European Venture Capital Association, Tim Creed of the fund of fund Adveq, George Arnold of the US fund of fund Knightsbridge, Harry Haskins Deputy Associate Administrator for Investment at the US Small Business Administration acting as a government fund of fund program since 1958, Daniel Cloquet of BusinessEurope, Uwe Eiteljoerge of the European Commission of DG Internal Market and Susannah Haan of the European Issuers.
The challenge we portrayed was how do private investors get more involved investing into SMEs and learn from existing programs in Europe and the US. A series of the results of these meetings held in Brussels and discussed with Mr. Drake in Rome July 12-13. Ambassador Miriam Shapiro, Deputy US Trade Representative joined in Rome with the Italian Minister of Foreign Affairs, US Ambassador to Italy, Mr. Thorne, 20 Embassy representatives and 180 private as well as regulatory and legislative bodies of the EU Commission and Italian Government.
“This was a fascinating discussion between fund of funds, government programs, public exchange platforms, VC and Angel networks, crowdfunding to SBA and SBIC program extensions on both sides of the Atlantic. Cross-Atlantic cooperation of the US and European Transatlantic Economic Council (TEC) forum of the most amazing sort has started. I could not have been prouder to partake in these movements.” says Mr. Drake.
The Soho Loft and FundingPost VC and Angel event in NYC is Next Thursday, Aug 9, 2012! This event will give you the opportunity to meet and network with Investors, hear a panel discussion and have plenty of time for Q&A with the VCs and Angels during the cocktail party. We will discuss the best ways to raise capital, meet investors, and what you need to get a check from early-stage Investors.
Crowd Funding Moderator
Doug Ellenoff, Partner at Ellenoff Grossman & Schole
Crowd Funding Panelists:
Vince Molinari, Founder CEO, Gate Technologies
Jed Cohen, Co-Founder & COO, RocketHub
Christine Landon, Founder & President, WebFinancial
Other Investor speakers:
Rob Delman, Golden Seeds
Marsha Yuan, NYC Investment Fund
Tom Nicholson, ARC Angel Fund
Eliot Durbin, Penny Black
James D Robinson IV, RRE
Brian Cohen, New York Angels
FundingPost and The Soho Loft will also present a roundtable on Crowdfunding and the JOBS Act. This we will give you the very latest information on this important legislation change, and what it means for entrepreneurs, angels & VCs, and how you can take advantage of it to grow your business!
WHEN: Thursday, August 9, 2012 2pm – 6pm
WHERE: 505 West 37th Street New York, NY 10018
Sponsored by TF Cornerstone, The Soho Loft, Nolcha, SocialRadius
Steven A. Cinelli, Founder and CEO of Primarq submitted this letter to SEC Thursday July 26, 2012. It gives a relevant insight to crowd funding Title III under the JOBS Act. We fully support and agree with the comments of Steven Cinelli. “His experience with Off Capital and derivatives experience offers a globally leading crowd funding and realty exchange platform at Primarq. “ according to David Drake.
Senator Jeff Merkley (D-Oregon) wrote this letter addressed to President Obama on Thursday July 26, 2012. It is an excellent piece on what is needed for crowdfunding investment to become an effective law – The Soho Loft supports this thorough outline of what is needed. Please share this letter.