Kim Lisa TaylorSecurities Attorney, Founder, Syndication Attorneys, PLLC · Corporate Securities Attorney, 2x Best-Selling Author, Nationwide Speaker | Private Placement

Regulation Crowdfunding Explained: Attract Everyday Investors! 💡 #realestatetips

14 Dec 2024 · 1 min

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In this brief segment, the speaker introduces Regulation Crowdfunding (Reg CF) as a financing option for companies seeking investments from non‑sophisticated investors. They explain that Reg CF uses the SEC’s Form C instead of a private placement memorandum, allowing individuals to invest up to $2,000 without the issuer needing to assess the investor’s financial status. The speaker warns that once total Reg CF capital raised exceeds $600,000, the issuer must undergo an audit, so staying below that threshold can avoid additional costs. Finally, they note that a company can run a Reg CF offering concurrently with a Rule 506 private placement, enabling flexibility in capital‑raising strategies.

Chapters

If any of you want to do an offering that is for people who are less than sophisticated, you can. It's a different type of offering called Regulation Crowdfunding. We can help you with those. There's a different form that we fill out instead of a private placement memorandum. It's a Form C that the SEC has. But with that, you can have anybody invest up to $2,000 without regard for their financial information. The problem is, is if you get over $600,000, you have to start doing audits, which are— so you want to keep your offering below that. But you can do a concurrent 506 and Reg CF offering.