Word on the street is there has been a recent increase in applications to become a FINRA regulated Funding Portal.<\/p>\n
A funding portal is a relatively new entity created under the JOBS Act of 2012. Funding portals may raise capital under Regulation Crowdfunding, commonly referenced as Reg CF. A funding portal is a regulated entity and a bit like a broker-dealer lite as it must adhere to certain compliance rules as it hosts companies seeking capital that sell securities online.<\/p>\n
Under current rules, an issuer may only raise $1.07 million under Reg CF in any one year a relatively anemic and arbitrary amount. The Securities and Exchange Commission (SEC) has proposed raising the funding cap to $5 million a move that may be fueling renewed interest in the securities exemption.<\/p>\n
Currently, there are 54 FINRA regulated funding portals and 12 former funding portals that no longer operate (and several that have not paid their FINRA dues). Although there are a good number of these regulated investment platforms, the bulk of the Reg CF offerings are hosted on a handful of online capital formation platforms. As well, broker-dealers may issue securities under Reg CF and several former funding portals have let go of their funding portal designation to become broker-dealers.<\/p>\n
So will we see an increase in new funding portals and affiliated securities offerings? Most likely yes, once the SEC moves the funding cap to a more reasonable amount.<\/p>\n<\/p>\n
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Reg CF Chatter: There are a Flood of New Funding Portal Applications - Crowdfund Insider<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Word on the street is there has been a recent increase in applications to become a FINRA regulated Funding Portal. A funding portal is a relatively new entity created under the JOBS Act of 2012. Funding portals may raise capital under Regulation Crowdfunding, commonly referenced as Reg CF Continue reading