June 1, 2020
Several weeks ago the SEC published newly minted proposed rules seeking to make life easier and simpler for emerging companies to raise capital. As well, I read with interest of certain changes to the definition of the unaccredited investor. Those changes are a good start. In recent weeks, the President issued an executive order calling for all government agencies to ease up, to find ways to promote business and commerce without burdensome regulations.
The SEC should consider further changes to the definition of unaccredited investors to allow for a larger pool of them to invest in offerings. Alternatively, the SEC should strongly consider exempting small investments of a few hundred dollars per deal from any and all paperwork. As well, the SEC should exempt companies accepting these investments from overly costly paperwork.
To wit I should be allowed to simply issue a check of a few hundred dollars directly into a company if like what they are selling and offering. If "Company A" has developed a new gadget or service and I like it, I should be able to write a check for up to certain amount without questions asked. No one asks me questions when I go shopping, when I fly, when I eat at a restaurant, or when I make a contribution. I am limited only by the cash I wish to spend, or by my credit card limit.
Why should I be left out of investing those same dollars into a company that might be the next Apple or Zoom? Dozens of such examples can be cited. Take the final step and exempt us little guys and little companies we understand that we may lose our investment. On the other hand, we might make multiples of our investment. The present regulations, while written to protect the little guys from fraud, need to be updated.
Thank you.