SEC Approves Regulation A+ Rules under Title IV of the JOBS Act that Pre-empts State Law and Paves the Way for Selling Up to $50 Million of Equity Crowdfunding Securities to Unaccredited Investors

There are no general solicitation restrictions so companies can freely advertise, market and publicize offerings at demo days, trade shows, mass media and via social media networks

 By Robert Hoskins

Washington, D.C. – The Securities and Exchange Commission adopted final rules unanimously to facilitate smaller companies’ access to capital.  The new rules provide investors with more investment choices.The new rules update and expand Title IV Regulation A+, an existing exemption from registration for smaller issuers of securities.

SEC Approves Regulation A+ Rules under Title IV of the JOBS Act

The rules are mandated by Title IV of the Jumpstart Our Business Startups (JOBS) Act.The updated exemption will enable smaller companies to offer and sell up to $50 million of securities in a 12-month period, subject to eligibility, disclosure and reporting requirements.

“These new rules provide an effective, workable path to raising capital that also provides strong investor protections,” said SEC Chair Mary Jo White.  “It is important for the Commission to continue to look for ways that our rules can facilitate capital-raising by smaller companies.”

The final rules, often referred to as Regulation A+, provide for two tiers of equity crowdfunding securities offerings:

• Tier 1:  Offerings of securities of up to $20 million in a 12-month period, with not more than $6 million in offers by selling security-holders that are affiliates of the issuer; and
• Tier 2: Offerings of securities of up to $50 million in a 12-month period, with not more than $15 million in offers by selling security-holders that are affiliates of the issuer.

Both Tiers are subject to certain basic requirements while Tier 2 offerings are also subject to additional disclosure and ongoing reporting requirements.

The final rules also provide for the preemption of state securities law registration and qualification requirements for securities offered or sold to “qualified purchasers” in Tier 2 offerings.

Tier 1 offerings will be subject to federal and state registration and qualification requirements, and issuers may take advantage of the coordinated review program developed by the North American Securities Administrators Association (NASAA).

The rules will be effective 60 days after publication in the Federal Register.

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Top 10 Tips for Selecting Crowdfunding PR Firm for Promoting/Marketing a Crowdfunding Campaign

Hiring an Experienced PR Firm with Strong Media Relations Experience and a Strong Database of Developed Crowdfunding Media Contacts Can Make or Break a Serious Crowdfunding Campaign Drive

Robert Hoskins, Director, Crowdfunding PR/Media Relations

By Robert Hoskins, Front Page PR

Follow these simple tips to find the best Crowdfunding PR firm to help launch a successful Crowdfunding PR campaign for fundraising platforms, portals, websites and individual Crowdfunding campaigns:

1. Check to see how many years the PR firm has been in business and examine what industries they have served
2. Review their Crowdfunding activity on popular social media sites such as Linkedin.com, Twitter.com, etc. to see how knowledgeable they are on popular Crowdfunding news trends in the media
3. Make sure they include a wide variety of written press materials in their monthly retainer, such as a Crowdfunding campaign profile, at least four press releases for a 30-day campaign, a Frequently Asked Question (FAQ) sheet, a short white paper, online press room, and media training/message maps for executive interviews, etc.
4. Make sure that you will be working with a media relations expert that has at least 10+ years of media relations experience. The more media relations experience the better your publicity results will be.
5. Beware of PR firms that recommend signing up for expensive online tutorials, which then later pressures clients to buy more expensive PR services when they realize that they simply do not have enough time, experience or media skills to pitch stories to reporters successfully
6. Beware of PR firms that want to use free or cheap news wire distribution services.  Always use a premium news wire service such as Businesswire.com, Marketwire.com, PRNewswire.com or PRweb.com.
7. Make sure the PR firm adheres a strict no conflict of interest policy meaning they do not represent two companies or Crowdfunding campaigns that would be considered competitors at the same time.
8.  Ask for a PR publicity guarantee and a clip report that shows clients all the news stories that their Crowdfunding PR campaign generated
9. Ask the PR firm what other types of value-added marketing services are available such as press conferences, community outreach, email marketing, Google advertising/analytics, building fundraising donor databases, data mining, trade show speaker placement, product launches and perks fulfillment.
10.  Last, but not least, make sure the PR firm is thinking long term with initial Crowdfunding PR campaign. This means they need to completely understand building brand share awareness as well as business distribution channels for your products and services.

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Click here to setup a conference call to learn more about launching a Crowdfunding Campaign!

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Need help using PR to generate funders/donor for your next big Crowdfunding campaign?

Need help using PR to generate funders/donors for your next big Crowdfunding campaign?

Need help using PR to generate funders/donors for your next big Crowdfunding PR campaign?

The key to building a successful Kickstarter, IndieGoGo or Rockethub crowdfunding is to plan ahead and put some money or skin into the effort. I would also recommend reading a book called “The Kickstarter Handbook: Real Life Crowdfunding Stories” by Don Steinberg.

This is a great book because it details how much actual works goes into a campaign before, during and after a successful crowdfunding campaign.  It also covers how using effective public relations (PR), media relations and social media strategies can either make or break your campaign.

After discussing the right and wrong way to handle the marketing, the crowdfunding handbook then discusses the types of rewards that can be given to your supporters as well as warn you not to promise something that you can not deliver without breaking your piggy bank.

The crowdfunding handbook then examines a lot of different crowdfunding campaigns and details what successful crowdfunding campaigns did right and what worked well for them in the publicity department as well as what unsuccessful campaigns did wrong. I highly recommend reading this book before launching any type of crowdfunding campaign and will only set you back $16.

Last, but not least, is the crowdfunding business plan template in the back of the book. It provides a step-by-step process of how to completely write up a crowdfunding business plan including all the videos, marketing, public relations, publicity, social media, event planning, email marketing campaigns, advertising campaigns, speaking engagements, and other cool ways to completely publicize and make the world and lots of investors aware of your crowdfunding campaign as well as the right calls to action to encourage people to review, analyze, join your movement and, of course, donate money to your crowdfunding campaign.

What the book does not explain fully is the step-by-step process of developing a PR media plan and how to leverage social media once you have begun getting some positive publicity.  That is what our firm does, teach people and businesses how to generate positive publicity and leverage large groups of people in vertical segments of social networking sites to pass along your crowdfunding campaign’s messaging points to millions of their friends, families, business colleagues and other good Samaritans that may not know or meet.

But if they like your product, service or crowdfunding cause as a hobby investor, social entrepreneur or micro investor, they may just give you $100 to get one of the first cool gadgets, widgets or rewards that your crowdfunding campaign promises them.

As with any blog post, always finish with a call to action.  If you need help creating a successful crowdfunding campaign, please give me a call at (512) 627-6622. Doing will not only put you in touch with the industry’s leading PR crowdfunding experts, but it will put your  story in front of the worlds top 250 media contacts that continuously write news stories about the crowdfunding portals as well as the latest and greatest crowdfunding deals of the day that are worth reviewing.

Learn how to generate publicity and investors for your crowdfunding campaign for a hockey stick growth rate!