Upcoming DPO(s) will help bring about Equity Crowdfunding Rules

After reflecting on the event at Crowdfund Texas, I have come to the firm belief that the upcoming IPO(s) from IPO Village will encourage movement on the rules that will ultimately  govern equity crowdfunding. Equity Crowdfunding will bring about a new asset class that will have its own rules and regs from both the SEC and FINRA. The Direct to Public Offerings (DPO) being presented on IPO Village are a natural intermediate step to this new asset class. Unlike the traditional definition of equity crowdfunding, the offerings shown on IPO Village are not private equity offerings. They are in fact companies that are going to be publicly traded and include all the benefits that come with that status. Two of the benefits from the perspective of the investing crowd are the facts that these companies will have filed S-1′s that have been approved by the SEC (standard investor protection as exists under 1933 securities law) and an established secondary market (The issues stock will trade on the OTC market).
This actually resolves two of the biggest concerns surrounding equity crowdfunding, the first of course is the disclosure (investor protection) being offered by companies seeking to acquire capital through equity crowdfunding, the second being, once you own a piece of a privately held company how do you liquidate the holding. There will ultimately be a secondary market for equity crowdfunded offerings, the question is when. Under the JOBS act you are required by law to hold that investment for a minimum of one year, this is not the case with a public offering.
The updated and fully functional version of IPO Village will be available over the next few week. This will include an investor education section and many features to ensure the crowd has access to the same level of detailed information as the “professional” IPO investor. All SEC filings and disclosures will be made available to the crowd in one easy to find location, as well as business plans, video’s and financials for the companies being presented for DPO (Direct To Public Offerings). Unlike any IPO we will have seen you will have an open forum to discuss the offering with other members of the crowd and have the opportunity to “Ask the CEO”. These questions and answers will be made available to the crowd. You can’t get that kind of transparency on any other platform.
Once the power and intelligence of the crowd is proven through the success of IPO Village, it will speed the change to private equity offerings via equity crowdfunding.
The updated site will be available at www.IPOvillage.com , Signup to take your place in line for the democratization of the IPO process. Signing up is not a commitment to invest but it is the only way you will have the opportunity to decide.

Crowdfunded IPO’s at IPO Village are Global

A person in Germany is on the internet looking for a place to invest some money and comes across an Initial Public Offering (IPO) at IPOVillage for a small company in Texas. The person looks at the prospectus and thinks to himself, “I sure wish I could participate in that IPO.”

He can. Anyone, anywhere who has a few dollars, pounds, yen, pesos or almost any currency can participate in an IPO run through IPOVillage.

While this is a fictitious example of an investor, the basic idea is fact. Anyone, anywhere with an internet connection and money can invest in an IPO through IPOVillage.

Somewhere in Australia, a small company wants to raise capital to expand its operation but is not entirely sure how to do it. The company owner finds IPOVillage and wonders if his company can go through this economical IPO process and be listed on NASDAQ.

He can.

IPOVillage is taking crowdfunding to the masses on a global scale.

CROWDFUNDING ACROSS THE GLOBE

Now a company anywhere in the world can take it’s IPO stock offering direct to the public. The company doesn’t have to negotiate through a stock exchange. The lawyers and institutional investors who reap huge rewards on IPOs at the expense of the company and the final investors are now cut out of the picture.

The investor benefits by getting the IPO stock at a much better valuation. What is the IPO price? That’s determined by the issuing company not an underwriter. Stock prices are not artificially inflated by the lawyers and investment banks.

The very people who will help the company grow and become a success will also reap the rewards of that success.

The company offering the IPO benefits by getting all the money from the IPO. The lawyers and banks do not get a cut of the stock sale. That means more money for the company to invest in expansion and improvement.

It does not matter where the company is located or where the investor is located. All that is needed is a company that has properly filed and been approved by the SEC. IPOVillage connects companies to investors around the world.

CURRENCY NOT A PROBLEM

Currency conversion is not Global Crowdfunding IPOa problem. IPOVillage offering companies accept PayPal, WePay, major credit cards and bank wire transfers. Each one of these payment programs converts currency at current market rates.

Foreign companies who place their offerings on IPOVillage will be approved for trading on NASDAQ. This means the companies receive US dollars, which is the world’s reserve currency and accepted in every major trading market in the world.

Currency conversion in today’s world is as easy as buying IPO stock through IPOVillage.

A GLOBAL VILLAGEThe Internet has opened the world to the world and that includes investing. IPOVillage is a global investing community and a destination for companies anywhere in the world which need more operating capital.

IPOVillage can work with most any company, from a few employees in one location to thousands of employees scattered across the planet. IPOVillage welcomes all investors no matter where they are from or how much money they have to invest.

It’s what we do.

Upcoming IPO on Track despite SEC delays on the JOBS Act

More delays in the rule making process for the JOBS Act (Jumpstart Our Business Startups Act) is not having any effect at IPO Village.

A crowdfunding initial public offering in the first quarter of 2013 is still on schedule. We don’t anticipate any delays either.

JOBS and the lack of getting it fully in place, has not had any negative effect on crowdfunding. It may, in fact, be just enough to get some companies to take a second look at crowdfunding. While the JOBS Act is supposed to make investing in a small business easier, it is not absolutely necessary. Crowdfunding an IPO is in no way impacted by the JOBS act, as going public utilizing the crowd is legal under current SEC rules.

IPO Village is moving ahead with the abovementioned IPO and is in negotiations with other companies.

ALREADY BEHIND

The news that SEC chairman Mary L. Schapiro is stepping down is having a ripple effect – to use the water analogy, it’s more like excellent surfing waves than a ripple – on JOBS. JOBS was signed into law in April has yet to be fully enacted by the SEC. The JOBS Act is supposed to make it easier for small businesses to generate operating and investment capital. The Security and Exchange Commission is charged with developing the rules to implement this law.

The SEC is already running behind on getting rules in place, states a report in the Washington Post. “The agency appears to already be behind schedule, as several regulatory questions concerning investor education and fraud protection remain unanswered,” wrote J.D. Harrison.

A business waiting on the JOBS Act rules to be in place before raising capital through an equity crowdfunding offering may be waiting a while. This leadership issue absolutely will delay the already-behind rule making process. How long the delay will be remains to be seen, but with the gridlock in Congress and a likely fight over who the new permanent SEC Chairman will be, it could be well over a year before we see any rules.

DON’T WAIT ANY LONGER

There is no need to wait. The JOBS Act is not necessary for a small company to go public and generate new capital for its growth. Crowfunding an IPO can be started at any time. The coming IPO at IPO Village (info here – Sign-up with no obligation to receive the companies name and begin your due diligence) was started knowing the JOBS Act rules were still being developed and might not be ready in time for the public announcement.

Any company waiting for the JOBS Act rules to be in place might wind up behind the economic recovery curve. That’s not a place to be for a growing business. With ready investors on hand and a need to meet future demands, there’s no need to wait for JOBS. IPO Village can handle an IPO for almost any size company right now. For a free company  evaluation – click here

Crowdfunding an IPO does several things that benefit a business:

1) It puts the investment opportunity directly in the hands of the public, the people who make a small business a success. Giant Wall Street investment firms are not involved.

2) It’s cheaper for the business. The expenses of hiring high-dollar investment advisers is gone.

3) It puts more money into the business. There is no selling stock at a discount to institutional investors or an underwriter. The public buys stock directly from the company.

A CHAIRMAN NEEDED

Adding to this not-quite confusion at the nation’s top financial oversight agency is a decision by President Obama to put current SEC Commissioner Elisse Walter to pro tempore chairman. She’ll be able to hold the post through the end of December 2013, at which time a permanent chair must be appointed.

Because this is top-end rule making, the SEC must have a chairman, and a permanent chair, to oversee the deliberations and final rules creation. A pro tem chairman is not likely to want to invest significantly in the process knowing a new chairman may have different ideas.

Another monkey wrench in the plans is the nomination process. Depending on how the Republic Party feels about the president’s nomination for permanent chair, it could take a while to get someone into that seat.

Implementing JOBS fully could be well more than a year away. Businesses that need to raise investment capital now have to decide: Can you wait a year or more? If the answer is no, then consider a crowdfunding IPO.