Everyone by now has heard of the JOBS Act and crowdfunding. Most people are not aware of another provision of the JOBS Act that could have a much larger impact on entrepreneurs and small businesses. The SEC news release of December 18, 2013 proposed Regulation A+ and announced that a 60 day comment period would start upon publication of Regulation A+ in the Federal Register. This provision would allow entrepreneurs to raise up to $50 million in a simplified form of an initial public offering. Depending on how this new Regulation A+ is finalized, raising $50 million under Regulation A+ could have a similar cost and similar regulatory compliance required to raise only $1 million under the JOBS Act “equity crowdfunding” proposed rules. This would be a big deal and favor more IPOs as opposed to mergers and acquisitions because of the cost considerations adversely affecting IPOs today.
I hope that the new Regulation A+ gets finalized. It will help many small businesses grow faster and will make IPOs more favorable than in the past. This would be good for businesses that need the capital to grow their business to produce products and services. Technology Ventures Corporation entrepreneur clients could benefit greatly from having this Regulation A+ available to them.