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The JOBS Act Title III provisions making it easier to crowdfund investments from ordinary investors finally went into effect in May, four years after the bipartisan bill was signed into law by President Obama in April 2012.

The Securities and Exchange Commission issued “Regulation Crowdfunding” last fall with an effective date of May 16, 2016. Those wishing to take advantage of the new law are required to issue their securities through a FINRA-registered broker dealer (investment bank) or via a registered “portal.”

My clients, Lynn Johnson and Jessica Nowlan, offered some insights based on their experience. Lynn is the Co-Founder and CEO of Spotlight:Girls. Jessica is the Founder of Create Shoppe.

  1. Get Clear: “Get clear on your values, goals, and projections for the exact kind of business you want to lead,” Lynn says.
  2. Identify Ideal: “Identify your ideal investor so that you don’t waste time chasing after opportunities that don’t match your values,” she adds.
  3. Ignore VC: “Venture Capital, although that is mostly what you hear about, isn’t necessarily the right way to get capital for every business, especially for smaller businesses and in particular for low income women,” Jessica says.
  4. Believe in Yourself: “Believe in what you are doing and believe in yourself. Seek the advice and guidance of trusted mentors that understand the diversity of funding options available and also your personal circumstances,” Jessica adds.
  5. Mine Community: “Mine your existing community for potential investors – friends, family, customers, supporters, etc. – through a crowdfunding model,” Lynn notes.
  6. Network, Network, Network: “You have to believe in what you are doing and yourself, and you need to get other people on board. When you don’t have the same networks as people with access, you have to build them yourself,” Jessica concludes.

Check out our video with details on our tips here: