This shortcut is allowing risky startups to raise billions from investors
Risky startups with a flair for digital marketing are using a regulatory exemption that allows them to hype their products and raise huge sums of money from individual investors, The Wall Street Journal reports. The companies have sometimes misled investors as they burn through tens of millions of dollars, struggle to generate sales, and continue […] Risky startups using a regulatory exemption that allows them to raise billions from individual investors without oversight, allowing them to hype their products and raise significant sums. The exemption, known as Regulation A, allows businesses to annually raise up to $75 million and raise billions of dollars from hundreds of thousands of Americans. These companies have misled investors and continue to seek more money. The SEC approved the exemption nearly a decade ago to make it easier for smaller companies to raise capital.
ที่ตีพิมพ์ : 11 เดือนที่แล้ว โดย Daily Report Staff ใน Business
Risky startups with a flair for digital marketing are using a regulatory exemption that allows them to hype their products and raise huge sums of money from individual investors, The Wall Street Journal reports.
The companies have sometimes misled investors as they burn through tens of millions of dollars, struggle to generate sales, and continue to seek more money, according to people close to the companies, internal documents and whistleblower complaints filed with the Securities and Exchange Commission.
The SEC approved the exemption nearly a decade ago, as part of an effort to make it easier for smaller companies to raise capital. Known as Regulation A, the technique allows businesses to annually raise as much as $75 million. As a result, companies have raised billions of dollars from hundreds of thousands of Americans with little oversight.
หัวข้อ: Startups