Intrastate Crowdfunding Resource Center

smaller-crowd-rdc-color-mdRight now you can go on the Internet and donate to your favorite cause or startup business and get a t-shirt or maybe a free doughnut every week but you cannot invest in your favorite startup and get a share of stock.

Why?

Because securities laws govern the issuance of stock. You can’t invest in a company that hasn’t registered their stock, or qualified for an exemption from registration.

Registration is designed to protect both investors and legitimate issuers. The challenge is balancing investor protection with the interests of small businesses and entrepreneurs seeking to raise money.

As the result of a new federal law called the JOBS Act, you will soon be able to invest in companies through crowdfunding. This form of investing is known as “equity crowdfunding.” But until the U.S. Securities and Exchange Commission completes its regulations to allow equity crowdfunding, this form of raising money remains illegal if done on a nationwide basis.

However, if you are interested in using equity crowdfunding on a local basis, a growing number of states have enacted exemptions within existing federal law that allow local small businesses and entrepreneurs to use crowdfunding to help grow their businesses by tapping into the crowd within their state’s borders.

The North American Securities Administrators Association is pleased to offer resources to help investors and small business owners learn more about equity crowdfunding.

Resources

To learn more about equity crowdfunding, contact your state securities regulator:

To learn if equity crowdfunding is legal in your state, or if your state is considering enacting crowdfunding legislation:

  • Intrastate Crowdfunding Legislation/Regulation (as of May 23, 2016) Note: This information is being provided for your convenience and is not intended as legal advice. The information is illustrative only and not an exhaustive list. Any questions should be directed to the appropriate state regulator.  

To learn details of individual jurisdiction intrastate crowdfunding legislation or regulation:

To learn what you should know about equity crowdfunding as an investor or small business owner/entrepreneur:

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