Raising Money in Washington Through Crowdfunding

As of earlier this month, you can officially use crowdfunding to raise money in Washington for your small business. This new way of raising money allows you to publicly advertise to all investors that you are selling stock in your company. Traditional securities offerings restrict advertising and limit offerings to those investors who satisfy the income and net worth standards to qualify as an “accredited investor.” This new opportunity is different from platforms like Kickstarter because with Kickstarter campaigns you cannot offer stock in exchange for the donations. Instead, you give individuals “swag” (e.g. promotional merchandise) in exchange for their donations.

Crowdfunding is not yet available nationwide despite a section in the JOBS Act directing the SEC to enact crowdfunding rules (Congress gave the SEC an unworkable bill).

Kyle Hulten put together a great post on the iVLG blog detailing Washington’s new crowdfunding law and the process for filing for launching a crowdfunding campaign in Washington state.

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