I have been working with entrepreneurs to raise capital for over 10 years.  This is the cheapest, fastest (legal) way to raise money from investors that I’ve found (and it only became available a couple of months ago)!

Step 1: Decide what you want to offer

There are many different types of investment instruments you can offer.

If you offer something simple, you don’t necessarily need to hire a lawyer to create your offering.

For example, you can download a simple promissory note which commits you to pay your investors a set interest rate (I recommend an annual payment, rather than monthly or quarterly, to make life easier) and pay back the principal on the maturity date which you should select based on your reasonable projection of when you will be able to afford to make that payment.

Step 2: Begin public offering under Rule 506(c)

Rule 506(c) allows you to publicly advertise your offering however you want.  Before anyone invests, however, you have to make sure they are accredited.

Under Rule 506(c)

  • There is no maximum raise amount
  • All investors must be accredited
  • You can do public advertising (email blasts, announcements at public events, social media, press releases, etc.)
  • You must file Form D with the SEC within 15 days after the first sale of securities
  • You must complete notice filings and pay fees in all states from which investments are made – this is where you might need to get help from a lawyer! Or you can call the relevant states for instructions

You can start reaching out to potential investors IMMEDIATELY under Rule 506(c) because there are no filing requirements until AFTER you have actually raised money.

You are not required to use any particular method to verify that all investors are accredited, but the SEC has deemed certain methods to be acceptable.

Step 3: Launch investment crowdfunding campaign on a JOBS Act Title III platform

To be able to launch under Title III, you need to make sure your financials meet the requirements for financials under Title III.  Once you have that in place, you just need to create your profile on the crowdfunding platform site.

Before launching under Title III, it is important to understand all of the requirements that go along with it such as ongoing reporting obligations that require you to post your company financials on your web site for anyone to see.

If you’d like to explore the options for raising capital for your business, apply for a strategy session.

Or attend our two-day training for women entrepreneurs, Fund and Fuel Your Dreams.

Interested in learning more? Get in touch!

If you are interested in working together, send us an inquiry and we will get back to you as soon as we can!

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