On November 2, 2020, the SEC adopted significant rule amendments to simplify, harmonize and improve the exempt offering framework to facilitate capital formation and investment opportunities in startups and emerging...more
11/9/2020
/ Capital Formation ,
Crowdfunding ,
Investment Opportunities ,
Offerings ,
Regulation A ,
Regulation D ,
Rule 504 ,
Rulemaking Process ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Testing-the-Waters Communications
On October 21, 2020, the United States District Court for the Southern District of New York entered a final judgment on consent against Kik Interactive Inc. to resolve the Securities and Exchange Commission’s charges that...more
11/2/2020
/ Blockchain ,
Capital Raising ,
Cryptocurrency ,
Enforcement Actions ,
Initial Coin Offering (ICOs) ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Simple Agreement for Future Tokens (SAFT) ,
Token Sales ,
Unregistered Securities ,
Virtual Currency
Finders play a vital role in introducing startups to potential investors. Yet the general requirement that persons soliciting investors must register with the Securities and Exchange Commission as broker-dealers and be...more
10/12/2020
/ Accredited Investors ,
Broker-Dealer ,
Comment Period ,
Exemptions ,
Financial Services Industry ,
Finders ,
Investment Adviser ,
Request For Information ,
Rule 506(c) ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Solicitation Provisions
The Securities Exchange Commission expanded the definition of “accredited investor” by adding new categories of investors that have sufficient investment knowledge and expertise to participate in private investment...more
This past June, autonomous vehicle technology startup Zoox agreed to be acquired by Amazon for a whopping $1.3 billion. Time for the common stockholders to pop the champagne, right? Not exactly, according to a complaint...more
8/26/2020
/ Bonuses ,
Business Judgment Rule ,
Carve Out Provisions ,
Compensation & Benefits ,
Controlling Stockholders ,
Corporate Sales Transactions ,
Fiduciary Duty ,
Initial Public Offering (IPO) ,
Preferred Shares ,
Purchase Price ,
Venture Capital
It’s no shocker that the Coronavirus pandemic has slowed down venture capital investment dramatically, with 2020 now on pace to be well below the high levels of the past couple of years. According to Pitchbook, VC deal flow...more
The impact of the Coronavirus and COVID-19 on venture capital investment will likely be similar to what we saw in the aftermath of the 2008 recession and the 2001 dot-com meltdown. VC investors will redirect their attention...more
Title III crowdfunding may be an attractive capital raising alternative during the current Coronavirus pandemic because it allows companies to use the internet to solicit potential investors and not be restricted to...more
COVID-19 induced declines in private and public company valuations have left many employee stock options “underwater” or “out-of-the-money”, i.e., exercise prices exceeding fair market value. This is a problem for employees...more
Among the many challenges companies are facing during the COVID-19 pandemic is how to conduct their shareholder meetings. Current social distancing requirements are effectively forcing companies to choose between postponing...more
Venture-backed companies did not receive the relief they had hoped for this past Friday, April 3rd, when the Small Business Administration (“SBA”) issued affiliation rule guidance on the Paycheck Protection Program (“PPP”)...more
Public companies stressing over how to meet filing deadlines during the COVID-19 crisis and what to say about the pandemic’s impact just received a filing reprieve and disclosure guidance from the SEC. The Securities and...more
It’s not often that an SEC Commissioner quotes Bruce Springsteen – not once, but twice – in a speech on securities regulation. But SEC Commissioner Hester Peirce did just that in a February 6, 2020 speech in which she...more
3/2/2020
/ Cryptocurrency ,
Digital Currency ,
Exempt Transactions ,
Initial Coin Offering (ICOs) ,
Offerings ,
Proposed Rules ,
Regulatory Agenda ,
Rulemaking Process ,
Safe Harbors ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Token Sales ,
Unregistered Securities
The Securities and Exchange Commission is proposing to expand the definition of “accredited investor” to include additional entities that could bear the economic risks of investment and certain financially sophisticated...more
1/22/2020
/ 501(c)(3) ,
Accredited Investors ,
Broker-Dealer ,
Business Development Companies ,
Capital Formation ,
Comment Period ,
Corporate Issuers ,
Crowdfunding ,
Financial Regulatory Reform ,
General Solicitation ,
Investors ,
Limited Liability Company (LLC) ,
Offerings ,
Private Offerings ,
Registered Investment Advisors ,
Regulation A ,
Regulation D ,
Regulatory Oversight ,
Regulatory Requirements ,
Rule 144A ,
Rule 506 Offerings ,
Rulemaking Process ,
Rural Business Investment Companies (RBICs) ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Statements of Net Worth ,
Venture Capital
On September 30, 2019, the Securities and Exchange Commission announced that blockchain developer Block.one had agreed to pay a $24 million fine to settle charges that it had engaged in an unregistered offering of securities...more
12/2/2019
/ Bad Actors ,
Blockchain ,
Capital Raising ,
Cryptocurrency ,
Digital Currency ,
Distributed Ledger Technology (DLT) ,
Enforcement Actions ,
Financial Markets ,
Initial Coin Offering (ICOs) ,
Investment ,
Offerings ,
Rescission ,
Section 5 ,
Securities Act ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Token Sales ,
Trading Platforms ,
Unregistered Securities ,
Virtual Currency
On October 11, 2019, the Securities and Exchange Commission (the “Commission”) announced it filed a complaint and obtained a temporary restraining order against Telegram Group Inc. and its wholly-owned subsidiary TON Issuer...more
10/28/2019
/ Blockchain ,
Contract Terms ,
Corporate Counsel ,
Corporate Issuers ,
Cryptocurrency ,
Digital Assets ,
Digital Currency ,
Enforcement Actions ,
Financial Transactions ,
Initial Coin Offering (ICOs) ,
Investment Opportunities ,
Offerings ,
Popular ,
Purchase Agreement ,
Regulation D ,
Restraining Orders ,
Rule 506(c) ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Securities Violations ,
Simple Agreement for Future Tokens (SAFT) ,
Token Sales ,
TRO ,
Unregistered Securities
The corporate spectacle better known as The We Company IPO officially and mercifully came to an end September 30 when The We Company (“We Co.”), the corporate parent of WeWork, requested that the Securities and Exchange...more
10/7/2019
/ Anti-Dilution Terms ,
Business Valuations ,
Certificates of Incorporation ,
Corporate Governance ,
Dilution ,
Initial Public Offering (IPO) ,
Investment ,
Investors ,
Notification of Withdrawal ,
Office Space ,
Preferred Shares ,
Registration Statement ,
Share Price ,
Sharing Economy ,
SoftBank ,
Venture Capital
On July 10, 2019, the Securities and Exchange Commission declared Blockstack PBC’s offering statement “qualified”, thus allowing Blockstack to commence the distribution and sale of its Stacks Tokens under Regulation A. ...more
8/5/2019
/ Blockchain ,
Initial Coin Offering (ICOs) ,
Investment Contract ,
Investment Opportunities ,
Offering Statements ,
Offerings ,
Regulation A ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Token Sales ,
Venture Capital
Non-accredited investors are estimated to constitute approximately 92% of the U.S. population. Yet restrictive rules governing exempt offerings have significantly limited their freedom to invest in private offerings and...more
7/8/2019
/ Accredited Investors ,
Comment Period ,
EGRRCPA ,
Fixing America’s Surface Transportation Act (FAST Act) ,
Non-Accredited Investors ,
Offerings ,
Privately Held Corporations ,
Public Comment ,
Regulation A ,
Regulation D ,
Rule 506 Offerings ,
Rule 506(c) ,
Securities and Exchange Commission (SEC)
The Securities and Exchange Commission filed a complaint last week against the founder of venture-backed mobile payments startup Jumio, Inc., charging him with causing the company to prepare false and misleading financial...more
Lyft, Inc. last week completed its highly anticipated initial public offering, raising over $2.3 billion at a valuation of approximately $25 billion, and turning its co-founders Logan Green and John Zimmer into near...more
2018 was a historically good year for venture capital in the United States in terms of dollars invested by VC funds in U.S. companies, dollars raised by VC funds and dollar value of exits by VC-backed companies, according to...more
Real estate developers should seriously consider equity crowdfunding to fund development projects for two major reasons, one of which has little or nothing to do with money. ...more
1/28/2019
/ Accredited Investors ,
Capital Formation ,
Crowdfunding ,
JOBS Act ,
Non-Accredited Investors ,
Offerings ,
Popular ,
Real Estate Development ,
Regulation A ,
Securities and Exchange Commission (SEC) ,
Venture Capital
On December 19, 2018, the Securities and Exchange Commission issued final rules to permit reporting companies under the Securities Exchange Act to offer securities under Regulation A (affectionately referred to often as...more
12/27/2018
/ Capital Formation ,
Capital Markets ,
Economic Growth Regulatory Relief and Consumer Protection Act ,
Emerging Growth Companies ,
Final Rules ,
Financial Regulatory Reform ,
Public Offerings ,
Publicly-Traded Companies ,
Regulation A ,
Reporting Requirements ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act
On November 27, 2018, the United States District Court for the Southern District of California denied the Securities and Exchange Commission’s motion for a preliminary injunction to block an initial coin offering, finding the...more
12/3/2018
/ Blockchain ,
Corporate Counsel ,
Cryptocurrency ,
Digital Assets ,
Digital Currency ,
Enforcement Actions ,
Initial Coin Offering (ICOs) ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Token Sales ,
Trading Platforms ,
Unregistered Securities