What a year this was! So much has happened in our smallcap world this year. Here are my top 10 highlights (and lowlights):

  • Regulation A+ rules were finalized, dramatically improving the range of options for capital formation for smaller companies. Unfortunately, two states challenging the new requirements have led some to hold off on utilizing the new rules.
  • The FAST Act got us easier transfers of interests in private companies, S-1 forward incorporation by reference, reducing financial disclosure and a longer confidentiality period for IPOs.
  • The SEC made it easier to demonstrate a pre-existing substantive relationship with an investor in a Regulation D offering.
  • Proposed changes to Rule 504 under Regulation D could offer expanded crowdfunding opportunities.
  • One well known smallcap attorney goes to jail for 18 months for pump and dump schemes, another arrested in an alleged market manipulation scheme, the same alleged scheme in which yet a third attorney in our space was arrested in 2014.
  • The SEC approved final Title II JOBS Act crowdfunding rules, with hope to help start-up companies raise money from large numbers of folks. In-state crowdfunding has also become more and more popular.
  • The Supreme Court made proving insider trading more difficult, leaving many in jail to seek release.
  • The SEC still does not seem ready to act on allowing private placement broker/finders to act without or with limited SEC registration as they have for M&A brokers. Same with allowing smaller companies the right to opt out of XBRL, even though the House passed it.
  • PIPE funds are resurfacing and raising money.