For those who like getting creative with capital, there is a new potter’s wheel to spin: equity crowdfunding. One aspect of the Jumpstart Our Business Startups or JOBS Act of 2012, in part, attempts to ease securities regulations for capital formation through crowdfunding. The Securities and Exchange Commission (SEC) has the duty of issuing rules and regulations around crowdfunding, which will impact real estate finance and investment. But until the SEC rolls out the roadmap probably in 2014, and takes into account the masses of non-accredited investors, where can developers and investors begin to turn for an introduction to crowdfunding for real estate? Start with these:
“Crowdfunding Property Deals on Horizon with U.S. JOBS Act” by Max Raskin on Bloomberg.
For a broader overview of crowdfunding:
"What You Need to Know About the New Equity-Crowdfunding Model" by Sally Outlaw for Entrepreneur, and her book, Cash From The Crowd.
“Crowdfunding Will Flourish Regardless of What the SEC Does” by Alan McGlade at Forbes.
Crowdfunding for Social Good, Financing Your Mark on the World by Devin Thorpe.
Also, check out Charles Luzar at Crowdfund Insider for “The JOBS Act: Misreporting & Setting The Record Straight.”
- October 2013