For the first time in 80 years, thanks to Regulation Crowdfunding, startups and small businesses can raise up to $1 million from friends, family, customers and non-accredited investors. As of May 16, 2016, the JOBS Act’s Title III Regulation Crowdfunding exemption enables capital-raising via Securities and Exchange Commission-registered websites.
Prior to this SEC provision, entrepreneurs’ financing options came down to personal savings, credit cards, banks (if they could qualify) and angels or VCs (if they were among the lucky few). While most media attention about this new opportunity has focused on an entrepreneur’s ability to sell shares (equity) in his or her high-growth-potential company, a real (and neglected) opportunity is for Main Street businesses to raise debt capital through crowdfunding.
