The Law & Economics of the Series A Gap

Scholars agree that crowdfunding regulations in Title III of the Jumpstart Our Business Startups (JOBS) Act are broken. My latest article addresses their concerns and proposes a solution for crowdfunding based on a deeper understanding of the startup fundraising market—a solution called “bridgefunding” for its ability to provide capital to startups at a particular time when they need it most. The broader theme is that a new exemption from securities regulation should consider how a new entrant will fit into an existing market. A narrower point is that startup funding may have a persistent market failure that regulations could solve. … Read more

How Twitter Is Disrupting Shareholder Activism

Shareholders are organizing and mobilizing on new social media platforms like Twitter. This changes the dynamics of shareholder proxy contests to favor small shareholders over management. Disruptive technology may bring about a shareholder revolution, which may not be in all shareholders’ best interests, at least from the perspective of shareholder wealth maximization, and it also has powerful implications for the future of corporate social responsibility.

Twitter and other social media are platforms for global social interaction. A twitter user can send a “tweet,” which is a sort of 140-character text message, to the world. About 500 million tweets are sent … Read more