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April 21, 2017

Legal changes likely to boost crowdfunding

  • Supporters say new federal rules will make it much easier for small businesses to raise money from in-state investors.
  • By CARA LOMBARDO
    Associated Press

    MADISON, Wis. — A former Green Bay Packers player whose consulting business has connected 400 high school athletes with college teams got a lesson in federal securities law when he sought to raise money for a new smartphone app.

    Videoscore owner Darryl Ingram decided to seek Wisconsin investors through a process called state crowdfunding, a relatively new and underused tool available to small businesses. What he didn't realize was that the system bans any ad that can be seen by an out-of-state resident, including solicitations through Facebook and Twitter, so his effort to raise $100,000 failed to land a single taker.


     
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