The JOBS Act:
An explanation of everything you need to know about the JOBS (“Jumpstart Our Business Startups Act”) and how it could affect your startup’s fundraising.
Want to learn about the JOBS ACT and How Startups Can Raise Capital?
In this review, we will examine the JOBS Act and how it affects your startup.
Here are the JOBS ACT Rules (You need to know):
"Title III of the JOBS Act established crowdfunding provisions that allow early-stage businesses to offer and sell securities. The SEC subsequently adopted crowdfunding to implement the crowdfunding provisions of the JOBS Act. The role of the Financial Industry Regulatory Authority (FINRA) is to oversee the registration of crowdfunding portals and to ensure that they comply with the federal securities laws and FINRA Rules. Broker-dealers and funding portals with the SEC and are FINRA members are permitted to offer and sell securities on behalf of issuers to the investing public using crowdfunding.
Investors are subject to investment limits that we describe below. Investors should be aware that crowdfunding investments carry significant risk: you can lose some or all of your investment."
According to the JOBS Act, who can invest in startups?
Like stocks and bonds, anyone can invest in crowdfunding offerings. But because of the risks involved, you are limited in how much you can invest during any 12-month period in these kinds of securities. The inflation-adjusted investment limits depend on your net worth and annual income:
If either your annual income or your net worth is less than $107,000, then during any 12-month period, you can invest up to the greater of either $2,200 or five percent of the lesser of your annual income or net worth.
If both your annual income and your net worth are equal to or more than $107,000 then, during any 12-month period, you can invest up to 10 percent of your annual income or net worth, whichever is less, but not to exceed $107,000.
Say your annual income is $150,000 and your net worth is $80,000. JOBS Act crowdfunding rules allow you to invest the greater of $2,200 or five percent of $80,000 ($4,000) during a 12-month period.
So in this case, you can invest $4,000 over a 12-month period.
If you are an investor looking to invest in America’s next top startups, get in touch.
You are more likely to succeed with your startup if you are a previous entrepreneur, even those who have attempted and failed before. Many failures are due to lack of management, vision and capital. Take advantage of the opportunities with Angel Kings and let us help you get the resources you need to be the 1 in 10.
Here are more tips on how to be a successful startup and a list on the top startups to follow.
How can you get started, under the JOBS Act, investing in these startups...
About Angel Kings’ funds:
Angel Kings is currently only focused on early-stage startups emerging from our design and development firm.
If you are a startup raising capital, you must be part of our design and build program to be considered for funding.
How To Get Started with Venture Capital and Startup Investing
#1 Know the Laws Behind the JOBS Act and Accredited Investors:
Before investing, there are three primary regulations you need to know:
Regulation D, 506 (b) – Private Fundraising
Companies can raised unlimited amounts of money from accredited investors and a maximum of 35 unaccredited investors.
Under Rule 506 (b), startups are only allowed to advertise fundraising to accredited investors.
Examples: AngelKings equity funds, WeFunder, FundersClub