President Obama signed the JOBS Act on Thursday April 5th 2012, which allows startups to begin crowdfunding up to $1 million per year from non-accredited investors.
If startups do decide to crowdfund, they’ll have to comply with a variety of annual financial disclosure requirements: self-certified financial statements or tax returns (for startups raising $100,000 or less), independent accountant reviews ($100,000-$500,000), or audited financials (more than $500,000). In addition, companies must disclose their capital structure. The SEC has 270 days to formulate these and other rules around crowdfunding.
The JOBS Act also lifts a longstanding, often-broken restriction on “general solicitation,” or publicly advertising that you’re raising money. Here, the SEC has 90 days to come up with a specific rule.
Companies such as STREETFUNDER will also have to register as crowdfunding hubs with the SEC.