Wefunder, a crowdfunding platform*, announced Our crowdfunding round:
So, we ate our own dog food. Using current state “blue sky” laws (which prohibited advertising), we raised $533,800 from 58 investors in amounts ranging from $100 to $100,000. Half of these investors were un-accredited.
It’s still not legal to use a crowdfunding platform in the U.S. So how did they do it? Wefunder shows you in How To Legally Crowd Invest…. Now. A summary:
- Only up to 35 un-accredited investors may invest.
To remain in compliance with the law, the total number of unaccredited investors – across all states – can not exceed 35. But, with the exception of investors in Massachusetts, the start-up can raise from an unlimited number accredited investors (in CA and NY).
- Investors must be a resident of CA, NY, and MA.
These states have “blue sky” laws that allow un-accredited investors to invest, without requiring a costly investment prospectus (a few other states have laws that may possibly work, but you’d have to confirm with your lawyer).
- No advertising or general solicitation is allowed.
You can’t broadcast your offering to the world. You can’t post your deals on Facebook, Twitter, get mentioned in the press, put out an ad, etc.
- Companies must comply with various State laws.
CA and NY require filing a notice and paying a small fee. MA has no filing or fee, but has different compliance issues.