• "Accredited investors" — Require investors to have a minimum net worth of $2.3 million or annual income of $450,000 — up from $1 million or $250,000.Bob Litan and Scott Shane express concerns.
• SEC registration — Require start-ups to register with the Securities and Exchange Commission and be reviewed for 120 days before raising any money.
• State control — Eliminate the federal waiver and allow states to regulate these private offerings.
Monday, May 17, 2010
Financial Reform Bill Threatens Small Business Finance
Part of the proposed financial reform bill contains provisions that may have a dramatic effect on the ability of entrepreneurial companies to raise money. Among the proposals: