Founders: Stay out of Fundraising Prison
Founders: Soon, you'll be able to publicly raise money from accredited investors. But the SEC's proposed rules assume you'll be raising money the way institutions did 20 years ago. This means that you will be required to:
- Notify the SEC 15 days before you publicly discuss raising money
- File documents with the SEC every time you change your deck
- Include legal boilerplate mumbo jumbo every time you talk about your financing publicly
Imagine having to notify the SEC in advance and file documents every time you have a new communication with investors, and include boilerplate with every communication. And if you break these rules? Your startup will be sent to "fundraising prison" -- a one year bar from raising any funds.
It doesn't have to be this way. Tell the SEC why these rules are backwards and kill innovation.
AngelList can help you understand the graveness of this issue: https://angel.co/sec
Here's what I wrote to the SEC:
You can fill your comments out in this form, and then for good measure email the SEC commissioners at:
- Chair office: firstname.lastname@example.org
- Luis A. Aguilar: email@example.com
- Daniel M. Gallagher: firstname.lastname@example.org
- Troy A. Paredes: email@example.com
- Elisse B. Walter: firstname.lastname@example.org
- David Marsh, SEC Staff: email@example.com
Or if you want to call the SEC, ring them up at (202) 942-8088.
I'll post any responses I get here.