The federal government using the infinite wisdom that has led to a $15 trillion deficit has decided to order the SEC inject itself into private lives by requiring people who want to go into crowdfunding to register all in the name of fiscal accountability. Why? Because one of the government mottoes is, “If it ain’t broke, fix it ‘til it is.” Since crowdfunding has so far been incredibly simple and so easy anyone with an internet connection could do it, government regulators have insisted something be done to complicate matters.
The SEC website has several links discussing the Jumpstart Our Business Startups (JOBS) act which contains language like “Cost-effective access to capital for companies of all sizes plays a critical role in our national economy, and companies seeking access to capital should not be hindered by unnecessary or overly burdensome regulations.” Reduced to plain English this means “It’s going to get a lot harder as soon as we find enough sociologists and lawyers to make it as confusing as possible.”
Actual crowdfunding websites approach it from the “Hey! C’mon and sign up today!” direction.
Go to the SEC website and you might be able to find a “FAQ” list to help you register your crowdfunding company. Pack a lunch because you’ll be there a while looking for it.
Since I have a near genius IQ, I am too smart to understand the FAQ. So I contacted a friend who once worked for the government. Well, he was a test subject in a military experiment, so close enough. Without further ado, here is what we, Richard “The Vermin” Thundersquat (he moonlights as a professional wrestler) and I came up with after reading the FAQ.
Question: I want to start a crowdfunding business. What do I need to do?
Answer: We need the following: Your name, your spouse’s name, a name of a child you have and one you do not have, the name of your uncle’s aunt’s sister’s brother’s cousin’s kid’s former college roommate, a urine sample, your urine sample, and a partridge in a pear tree.
Question: What if I want to seek crowdfunding for a project that will help orphans and other children?
Answer: Well, since that would be a good idea, we can’t let you do that. There is no federal regulation yet and without federal regulation, good things may happen. We cannot allow good things to happen without federal oversight because who would reap the rewards? Small businesses, startups and inventors who actually have valid ideas or the government? Can I have a glass of water?
Question: But I have a valid idea that is only slightly cooler than 0 degrees Kelvin, will not cost much money and has the ability to help millions of people without interference from any government entity. And I don’t have a glass for your water.
Answer: Now this is just ludicrous. How can anyone expect to get anything done without oversight from the government? We have to have a hand in it! There are regulations to institute, policies to follow, lobbyists to pay and taxes to levy! And stuff!
Question: So, you are basically saying I cannot use crowdfunding because the government does not have a hand in it, and the government does not have a hand in it because they don’t have a hand in it?
Answer: You betcha!
So there you have it, what Richard and I figured out about crowdfunding and the SEC. Since we could not get a direct answer, we have decided to challenge SEC Chairman Mary Shapiro and former chairman Christopher Cox to a tag-team cage match, winner gets the right to determine how crowdfunding will be regulated. We’re negotiating the rights to put it on Pay Per View and failing that, we’re have a crowdsource funding campaign to raise money to rent a high school gym somewhere.