JOBS Act
The 2012 JOBS Act (short for “Jumpstart Our Business Startups Act”) was a sweeping law intended primarily to overhaul financing options for small businesses, as well as make it easier for private companies to go public (if they wanted to), and to create new intermediate options between staying private and going public for those that sought to stay private longer (aka, “mini-IPOs”).
The 2012 JOBS Act (short for “Jumpstart Our Business Startups Act”) was a sweeping law intended primarily to overhaul financing options for small businesses, as well as make it easier for private companies to go public (if they wanted to), and to create new intermediate options between staying private and going public for those that sought to stay private longer (aka, “mini-IPOs”).
The Act was divided into the seven sections (referred to as “Titles”):
- TITLE I - REOPENING AMERICAN CAPITAL MARKETS TO EMERGING GROWTH COMPANIES
- TITLE II - ACCESS TO CAPITAL FOR JOB CREATORS
- TITLE III - CROWDFUNDING
- TITLE IV - SMALL COMPANY CAPITAL FORMATION
- TITLE V - PRIVATE COMPANY FLEXIBILITY AND GROWTH
- TITLE VI - CAPITAL EXPANSION
- TITLE VII - OUTREACH ON CHANGES TO THE LAW OR COMMISSION
In the context of crowdfunding and online alternative investing, Titles II, III, and IV are the most relevant:
- Title II changed the rules about “public solicitation” to accredited investors for certain types of investments (like traditional angel investments and commercial real estate syndicates). These are covered by SEC Reg D.
- Title III created a new way for businesses to raise money from any investor, even ones that don’t qualify as “accredited investors”. The SEC regulations that implemented this part of law are known as Reg CF.
- Title IV includes two separate tiers (Tier 1 and Tier 2, natch). While Title III suits genuine “startup” companies (the proverbial guys or gals in a garage), Title IV is actually geared more toward companies a bit further along, who want to raise money from the general public (including non-accredited investors), but are not yet ready for a true IPO and listing on a stock market. (Some even refer to Title IV offerings as “mini-IPOs”.)
You can read more about the gory details of crowdfunding regulations on our blog.
Want to learn more but aren’t sure where to start? You can explore 168 crowdfunding investment platforms in our database and learn more about the nuts and bolts of crowdfunding and alternative investing on our blog. Did you know you can use a self-directed retirement account to invest in many alternative investments? Rocket Dollar makes it easy, and when you sign up using that link you'll be helping to support YieldTalk.
Featured Reviews
EquityMultiple
EquityMultiple stands out among real estate crowdfunding investment platforms because their main investors and senior leadership come from institutional real estate finance, rather than being VC-funded. Seed funding for the company was provided by Mission Capital (later acquired by Marcus & Millichap) and their co-founders and board of advisors come from the New York real estate finance and law community. They offer fewer investments than some other platforms, but that’s a deliberate choice to take a more curatorial approach to dealflow. Overall, EquityMultiple is a solid choice for accredited investors looking for a hands-off way to invest in commercial real estate.
"Gain exclusive access to high-yield commercial real estate deals"
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First National Realty Partners
First National Realty Partners (FNRP) is a commercial real estate private equity firm that focuses on grocery-anchored commercial shopping centers, offering both investments in individual properties and an Opportunity Fund across all of their offerings.
"First National Realty Partners (FNRP) is a rapidly growing commercial real estate private equity firm that owns and operates real estate throughout the United States. FNRP focuses on expanding its portfolio by acquiring market-dominant, well-located commercial assets well below replacement cost. "
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Percent
Percent aggregates private-credit investments from a range of originators offering small-business, crypto, venture loans, litigation finance and more, including international debt investments. Low minimums.
"Percent unlocks exclusive private credit investments for your portfolio. Access select alternative investments on the platform powering the future of private markets."
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