American JOBS Act, A Brewery, And Me.

Step right up, step right up! So President Obama signed a bill yesterday called the JOBS Act where JOBS = Jumpstart Our Business Startups. That bill, might, just might make my life easier in the coming months. I knew there was a reason I voted for him!

See, getting private investors for a small business has much regulation. These regulations are supposedly meant to protect the would be investor from fraud. I'm sure they do help prevent fraud buuuuuuut....... the shitty thing about these regulations is that depending on the circumstances, a small business can have a maximum of 35 "non-accredited" investors but unlimited "accredited" investors, meaning professional brokers and such. Furthermore, small businesses are limited in how they can advertise about equity offerings. These regulations are based on the amount of securities sold and various other parameters that I don't yet fully understand. What that says to me is that people with money and connections get to cherry pick whom they invest in, everyone else gets the scraps. Grrrrr. (Here's a link to the SEC's website on the subject.)

Now, from what I can tell, the JOBS Act doesn't necessarily do away with the number of investor limitations, but it does change the way a small business can advertise and also now allows businesses to sell shares via "crowdfunding", a la Kickstarter. Currently, crowdfunding sites cannot sell securities for small businesses. This new law changes that.

I have no idea if any of these changes will affect Panic Alarmist Brewing when the time comes to offer private equity in the company (which is coming sooner rather than later), but I can't help but think that they will. That's a good thing.