If you are or have ever been through the process of raising private capital for an emerging company, you are well aware of the regulatory framework that seems to have been created to test your commitment. When you raise money for your venture you are almost undoubtedly selling a "security." The offering and sale of securities are regulated by both the federal government and each state which has jurisdiction. What this means: when you raise money, the securities you are offering are either: (1) registered; (2) exempt; or (3) illegal. Almost every new and growth stage company will rely on an exemption from registration which is an expensive process and offering illegal securities is not a solid business plan. (Before you ask, there is no "friends and family" exemption.)
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