Crowdfunding is an exciting development that uses the power of the internet to allow entrepreneurs and startups to efficiently raise financing from a large number of people who each contribute a small amount of money. It breaks with the past by enabling companies to locate investors through a passive internet platform rather than through the active selling efforts of a traditional broker-dealer intermediary. Websites like Kickstarter, Indiegogo and GoFundMe helped popularize the concept and led Congress to legalize a variety of new ways for companies to raise capital through sales of stock and other securities. Regulation Crowdfunding (“Reg CF… Read more
In 2015, in a trilogy of releases on early-stage capital-raising, the U.S. Securities and Exchange Commission (the “SEC“) took bold steps to clarify its integration guidance. The result changes the textbook on how various securities-based offering methods can be combined. Principally, a long-required five-factor test that often blunted the concurrent use of different offering methods has now been replaced in many contexts with a unitary framework focused on whether advertising and solicitation in one offering is improperly conditioning the market for another. In addition, updated integration safe harbors permit (or propose to permit) the serial use … Read more
The European Commission, in its green paper dated February 18, 2015, announced the “need to build a true single market for capital – a Capital Markets Union for all 28 Member States.” One of the goals of the Capital Markets Union is to unlock more investment for small and medium sized enterprises (“SMEs”). SMEs are Europe’s equivalent to startups and small businesses in the United States. At present, small businesses in Europe receive five times less funding from the capital markets than their American counterparts. So, the European Commission is looking for feedback from those who work in … Read more
Columbia Law School Professor Robert J. Jackson Jr. recently moderated a lively debate on financial innovation before a panel of experts including Congressman Barney Frank, The New York Times’ Andrew Ross Sorkin, Nobel Laureate Robert Solow, and Gary Gensler, chairman of the Commodity Futures Trading Commission.
Today, the Bipartisan Policy Center’s Financial Regulatory Reform Initiative working group on Capital Markets and the Volcker Rule sent a letter to the Treasury Department and the five federal financial regulators tasked with adopting Volcker Rule regulations. The letter responds to recent reports that the five federal financial regulators may not adopt a single, unified set of regulations. It calls for one consistent Volcker rule and for a new public comment period for proposed regulations.
The initiative’s working group includes Professor John Coffee of Columbia Law School, Professor Jim Cox of Duke University School of Law, Annette Nazareth, a Partner … Read more