Discover the latest laws, trends, tips and techniques to raise money for your business or investment opportunity at the 2nd Annual Global Crowdfunding Convention and Bootcamp in Las Vegas, Nevada.
Co-host of The Real Estate Guys™ radio show, Russell Gray, will be there and invites YOU to join him and learn more about this exciting concept. Click here to register now.
Crowdfunding is one of the most promising developments in fundraising. Though it’s been used for decades to help fund things like movies, political campaigns, research, civic projects and the occasional startup business, there are two recent changes that are bringing crowdfunding more into the main stream.
In 2012, the U.S. government passed the Jumpstart Our Business Startups or JOBS Act. One of the purposes of the JOBS Act is to make it easier for individual investors invest in start-up businesses by eliminating some of the red tape entrepreneurs face when raising money. Yes, we know it’s ironic that MORE legislation is intended to REDUCE the red tape, but what else would you expect from government?
And not surprisingly, despite all the hope and hoopla, the actual implementation of the JOBS Act with respect to crowdfunding has been a slow trek.
However, on July 10th of this year, the Securities and Exchange Commission (SEC) issued regulations which has given the market hope that progress is being made. We’re sure one of the highlights of this years Crowdfunding Bootcamp will be updates and advice on how to take advantage of these new changes.
What is Crowdfunding?
Simply stated, crowdfunding is a process by which individuals and small companies can take their offering directly to the public without the expense and hassle of going public. In their purported efforts to protect Mom & Pop investors from “risky” investments, the SEC has imposed strict rules about selling securities (stocks and bonds of entities) that are not publicly registered (as if publicly traded securities are “safe”!).
The net effect of this SEC “protection” is that small, private companies and start-up businesses have had a very difficult time raising money outside of friends and family. And, as Robert Kiyosaki points out in Rich Dad’s Guide to Investing, it’s also prevented non-millionaire investors from enjoying access to many attractive private deals.
The JOBS Act and the July 10th SEC decision look to lower the hurdles entrepreneurs and investors face when raising money from the general public.
The second exciting change that is enhancing the opportunity for entrepreneurs to use crowdfunding isn’t legislative and it isn’t a secret. Obviously, the internet has profoundly changed the way the world does business and crowdfunding is just one more beneficiary. How?
The value of stock brokers and investment advisers to entrepreneurs has always been their control of the distribution channel for securities. If a corporation wants to raise money by selling equity (stock) or debt (bonds), the most cost effective way to do so was to issue the offering through Wall Street. Wall Street had all the often exclusive connections to the investors.
Today, people are more directly connected than ever before though the internet. In retail, buyers can shop the world today and even a small business with one physical location (or NO physical location) can have a global presence! The Real Estate Guys™ radio show is a great example of this. In real estate, buyers and sellers can find each other much more easily without depending upon the exclusive databases of the local real estate agents. This has forced agents to focus on adding value to the transaction by way of their marketing and negotiating skill, and not merely as the gatekeeper of inventory. We think that’s a very good thing.
More recently, social media has accelerated inter-connectivity of both businesses and private individuals. Even children have thousands of connections all over the world! So today, entrepreneurs often have or can quickly build a large “crowd” they can go to for funding. And as the aforementioned regulatory hurdles are lowered, crowdfunding has the potential to be a major source of investment capital. Now, even a relatively small time real estate investor can quickly leverage his or her expertise and efforts by raising money from private investors and building a profitable real estate portfolio. And that’s just one of MANY potential applications for crowdfunding.
So, if you want to build a business or investment portfolio and need investment capital, crowdfunding is a concept you will want to become immediately familiar with. A great place to get up to speed quickly, while meeting all of the major players and service providers, is at the upcoming 2nd Annual Crowdfunding Conference and Boot Camp in Las Vegas on October 14-16. 2013. Click here to register.
Check out this video from last year’s Crowdfunding Conference and Boot Camp:
When you consider the value of just one great idea or connection (plus how fun it is to visit Las Vegas!), the Crowdfunding Conference and Boot Camp seems like a great way to explore the opportunities awaiting YOU through crowdfunding.
So make your plans today to join The Real Estate Guys™ radio show co-host Russell Gray and hundreds of other crowdfunding enthusiasts in Las Vegas October 14-16, 2013. Click here here to register now.
