Although the Securities and Exchange Commission (“SEC”) proposed rules to implement the JOBS Act’s crowdfunding provisions last year, it has yet to adopt them. Despite that fact, or perhaps because of the absence of final rules, the discussion on how crowdfunding may assist small companies raise capital continues. br />
The Securities Law Prof Blog noted an article by Indiana University Kelley School of Business Professor Abbey Stemler entitled “The JOBS Act and Crowdfunding: Harnessing the Power – and Money – of the Masses.” The article notes the potential power of crowdfunding, but cautions that substantial risks accompany those possibilities.
Similarly, Slate warned of the pitfalls awaiting crowdfunded companies, which include extensive registration and reporting requirements.
Blogging for The Conglomerate, Wharton Professor Eric Orts suggested that crowdfunding could prove to be the type of disruptive legal technology that changes the landscape of business organization.
The Conglomerate also posted University of Illinois Professor Christine Hurt’s blog on state crowdfunding laws. Hurt lists the states that have passed or are considering intrastate crowdfunding laws and two websites which engage in intrastate crowdfunding.