The JOBS Act reached its tenth anniversary in 2022. We celebrated the date with the launch of our Podcast, KoreTalkX, recently mentioned by Spotify as in the top 10% of the most shared shows globally. But the regulations that brought a lot of novelties to the capital raising process still face some misconceptions, especially regarding Crowdfunding. We are introducing Online Capital Formation and why you have to understand it.

We do write a lot about the democratization of capital because we believe that everyone should be able to participate and share in the benefits, whether as entrepreneurs, brand advocates, innovators, or investors (both accredited and non-accredited). What we may be missing here is that Regulation CF (RegCF) has matured over the past decade, and it is time to look at it in a more complex way.

For many individuals, the word  “crowdfunding” still evokes KickStarter as a Top of Mind idea. Entrepreneurs that need money to launch a product pitch their ideas online ...more

In the past week, the public release of OpenAI’s ChatGPT, an artificial intelligent "bot" has garnered a lot of press and attention. As with many leaps forward in technology, people are struggling to understand the impact it will have on society and in some cases, on their very own lives or livelihoods. 

If you ask ChatGPT whether or not AI could have an impact on the field of investment crowdfunding, it will tell you:  

"Yes, it is possible that AI could have an impact on the field of investment crowdfunding. AI can be used to process large amounts of data quickly and accurately, which could be useful for analyzing potential investment opportunities and making predictions about their success. Additionally, AI could be used to automate many of the tasks involved in managing a crowdfunding campaign, such as identifying potential investors and tracking progress toward fundraising goals. However, it is also important to consider the potential drawbacks of using AI in this contex...more

If we hope to build a thriving economy that supports a diversity of business models and entrepreneurs, we should work to expand inclusive non-VC business funding models .... cont'd 

https://www.entrepreneur.com/leadership/venture-capital-funding-no-longer-provides-a-just-and/438356 

If you’re trying to build something (a company, a product, a service) and not simultaneously building a community, then the future is likely dim. Customer acquisition costs have never been higher due to App Tracking Transparency (that’s a whole other post - explainer here) alongside increasing competition because it's never been easier to start a business in a world of AWS, 3PLs, Shopify, open AI models, and other software tools that are essentially a business in a box.

This is why community matters. Community by its nature is a group of like-minded individuals coming together, and this ultimately can equate to built-in distribution. And I cannot stress this enough: distribution is the best and biggest competitive moat. In some sense, distribution is all that matters; you could have the best product/service in the world, but without a distribution moat you’ll be left high and dry.

A great example of this is in the newspaper business – once upon a time the printing presses and physical ...more

The kinds of securities we will offer

We could offer any kind of Security on the Platform, including:

Equity Securities. When you buy an “equity security,” like the common stock of a corporation, you become an owner of the company. The value of your interest fluctuates with the fortunes of the company; if the company does well the value of your interest goes up, while if it does poorly the value goes down, possibly all the way to zero. As an owner, you generally have the right to share in any profit distributions made by the company, and you also share in the appreciation in the value of the company. Owning an equity security in a company is like owning a house, both the good part and the bad part. When a company dissolves, the owners of the equity securities are paid last, after all the creditors.

“Preferred” Equity Securities. In some cases, a company will offer a “preferred equity security,” like the preferred stock of a corporation. Typically,...more

The saga surrounding the pending acquisition of Twitter and the recent public disclosure of texts between Elon Musk and his network are revealing in a few ways.

1: “Randos” Everywhere: The strategies he and his pals throw around for monetizing and "freeing speech" on social media are totally random or "rando" as he would put it. It reflects the opinion of people operating in the clouds, rather than in the trenches of social media technology or policy. With enough money thrown at the problem, they will likely back into some “right answers” for improving Twitter’s performance -- but it would not be because of any special insight or grit.      

2. The Billionaire Insider’s Club: Elon puts together a syndicate of friends / investors to purchase Twitter and it is a club of people willing to toss in a billion here, a billion there -- because it would "be fun" (Reid Hoffman). Oracle founder Larry Ellison agrees to invest a couple billion af...more

Many seeking to raise capital for their business usually use the tried-and-true Regulation D exemption from the IRS. But did you know that going the Regulation A (Reg.A) route may provide you with more flexibility, both in the short and long term? In this podcast, Mike Brette from Small Cap Equity Advisors discusses some of the options, nuances, and advantages that Reg.A provides compared to a private placement under 506(c) Reg D. But you have to do it all correctly. And one thing’s for certain: you don’t want to raise any red flags with the SEC!

LISTEN TO THE PODCAST HERE

Many think raising money under Reg.D is cheaper, better, and faster than doing a Reg.A. Are they right? Despite being around for a while now, not many business owners, CEOs, and issuers truly understand crowdfunding, especially Reg.A crowdfunding. When you listen to this podcast, you’ll get a better understanding of why Mr. Brette is so bullish on the topic. From its liquidity options on secondary markets, costs invo...more