This was a busy week for Crowdfunding in Washington, DC. Sherwood Neiss, Chief Advocate for the Startup Exemption spent the last weekend working with and prepping Tim Rowe Founder and CEO of the Cambridge Innovation Center for Tuesday’s Senate Banking Committee Hearing on Capital Formation. Mr. Rowe was the expert panelist speaking about the benefits of Crowdfund Investing (CFI) not only for the 450 startups in his innovation center (including Crowdfund Investing platform Wefunder) but for the thousands of entrepreneurs that don’t have access to Cambridge, Silicon Valley, or Wall St.
Unlike prior hearings that were hostile towards Crowdfund Investing, this hearing had a growing list of bipartisan supporters including once vocal opponent, Senator Charles Schumer. In his remarks he stated, “Given the level of bi-partisan support… passage in the Senate appears not to be a matter of if, but of when. I expect a comprehensive Senate proposal to be announced in the coming days.” With two Senate Bills on Crowdfunding, a compromise solution advanced, and Republicans and Democrats lining up, perhaps the guys at LegalizeCrowdfunding.org will see the light of day soon.
The Senate is under pressure to act or be portrayed as out of touch with Americans who want action in Washington. The House crafted, marked up and voted on six capital formation bills all meant to spur innovation, entrepreneurship and employment. All received overwhelming bi-partisan support, including the Crowdfunding bill H.R. 2930 (the basis of which comes from the Startup Exemption framework) that was approved 407-17. All have been sent over to the Senate where Senator Reid who controls the calendar has refused to act until now.
In a direct affront to the gridlock that exists in Washington, DC, the House decided to show America where in fact the bottleneck in Washington resides – with the Senate. Today the JOBS Act, a compilation of all the already passed, aforementioned Capital formation bills (including Crowdfund Investing) were grouped together in one bill and passed again by the House. This tremendously bi-partisan bill addresses the challenges that are preventing our nation’s job creators from getting capital that they need to innovate and hire Americans. By grouping them together, one bill will be sent to the Senate to take up rather than several. It either keeps the Senate from debating and stalemating on each one or forces them to come up with their own JOBS Act (which is hard since they haven’t taken up and passed any of the bills from the House to date). To further point the finger, the President came out and publicly endorsed the Republican championed legislation.
Backed up against the wall, Senator Reid announced that the Senate will move forward on these capital formation bills. How he will do it is up in the air. The choices are in Committee or on the floor of the Senate. If it is done in Committee then both sides can work out their issues and come to a compromise. If Reid decides to take it directly to the floor then he opens it up to Amendments that historically prove to derail the process and reinforce the gridlock.
Now is the time for entrepreneurs who need access to capital to call both Senate Majority leader Harry Reid (D-NV) at (202) 224-3542 and Senate Banking Committee Chairman Tim Johnson (D-SD) at (202) 224-5842 and let them know that America’s Entrepreneurs need Crowdfunding.
Categories: Congressman Patrick McHenry · crowdfund investing · crowdfunding · LegalizeCrowdfunding.org · Sherwood Neiss
Tagged: crowdfund investing, crowdfunding, HR 2930, President Obama, Sherwood Neiss
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Dear Crowdfunding Followers,
Here’s the latest from the guys leading the charge to legalize Crowdfund Investing (CFI) in Washington, DC.
LegalizeCrowdfunding.org goes live.
Already 138 entrepreneurs have registered to create 2,500+ jobs, which will have over $100M in stimulus! Let’s show Washington, DC the power of Crowdfund Investing! If you are an,
- Entrepreneur: Register to show how many people you need for your business (eg: jobs you will create) and the economic impact it will have.
- Investor: Register to show the impact your dollars will have stimulating our economy.
- Crowdfunding Supporter: Send an email to your Legislators, Tweet and Post about the site!
Endorse Crowdfund Investing! SBE Council plans to send this group letter to U.S. Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY) in the coming week. If you would like to sign onto the letter and add your name to the growing list of groups representing small business owners and entrepreneurs that are urging the U.S. Senate to take action, please send your name, affiliation and email contact information to SBE Council at firstname.lastname@example.org.
Status of Legislation
- The Good: As it stands we have 3 bills before Congress. HR 2930 passed the House with an overwhelming 96% approval – Yes that’s true bipartisan support. President Obama came out and endorsed the Bill with a Statement of Administrative policy and also included our framework in the Startup America Legislative Agenda. Things have slowed down in the Senate but to help move things along we went back to Washington and presented them with some Commonsense Consensus ideas that pull the best of the 3 bills into one.
- The Bad: NASAA’s opposition to crowdfunding is also in opposition to the needs of our economy, entrepreneurship and jobs. NASAA argues that they are best suited to regulate simple, transparent markets for businesses on Crowdfunding Intermediaries. This would create 50 different markets for Crowdfunding, rendering Crowdfund Investing dead on arrival. This is part of the reason it is so hard for small businesses to raise money today; different bureaucratic, costly rules for each states. Since CFI is based on community financing, we believe the crowd can do a better, faster, cheaper and more efficient job of determining which ideas, if any, should be funded and with how many dollars. It is that simple. Leave the heavy-handed, traditional regulation and oversight for the larger businesses that can access traditional capital. We advocate state regulation preemption, while preserving the enforcement power of the states to pursue fraud when it occurs.
Would you like us to speak to your organization/group about Crowdfunding? We are finding there is much confusion about what Crowdfunding is, how Crowdfund Investing differs, how investors are protected and what CFI means for our economy. Please contact us to discuss your event and how we can participate in sharing this information. Here are a few of our upcoming events:
- Feb 29th – Crowdfunding & Startup Investing
- Mar 6th – The Future of Startup Financing: A North American TeleForum on Crowd funding
- March 13th – The Soho Loft Crowdfunding Conference, Los Angeles, CA
- March 20th – TiE Arizona @ Thunderbird, Glendale, AZ
- March 28th – 30th MIT Global Startup Workshop – Istanbul, Turkey
- April 19th The Crowdfunding Conference, 2012 – New York City
Loudsauce Campaign: Our
friends at Laudsauce have launched a campaign to place a one-page ad on the back of Politico. Politico is seen by 32,000 eyes in DC so let’s show all those folks working on Capitol Hill how Crowdfund Investing Equals JOBS.
Fund the fight: None of this is happening for free.
If you haven’t yet, please donate $50 to help us get this legislation across the finish line! Every $50 donation will get your name listed in the ‘I support Legalizing Crowdfunding’ section of the website.
Crowdfund Investing Blog Posts: If you haven’t had a chance to see any of our recent posts, here they are:
Contact us: Got a comment? Need to speak to us? Here’s how …
Sherwood Neiss, email@example.com, 202-247-7182
Jason Best, firstname.lastname@example.org
Zak Cassady-Dorion, email@example.com
Categories: crowdfund investing · crowdfunding · Jason Best · LegalizeCrowdfunding.org · Sherwood Neiss · Zak Cassady-Dorion
Tagged: crowdfund investing, crowdfunding, jason best, legalizecrowdfunding.org, Sherwood Neiss, zak cassady-dorion