LOS ANGELES--(BUSINESS WIRE)--NextGen Crowdfunding – a company that helps startups connect with both entry-level and experienced investors – announces a new report showing that a diverse range of industries in the U.S. are embracing new equity crowdfunding rules to raise capital. NextGen analyzed 131 companies that have filed to use the so-called “Regulation A+” rules that took effect in June 2015 as part of the 2012 JOBS Act.
The new report is the first to establish an industry benchmark on how the new regulations are being used by companies nationwide. The Reg A+ rules allow both accredited and non-accredited investors to fund startups raising up to $50 million through online investments of as little as a few hundred dollars.
Key findings of the NextGen report include:
- Reg A+ companies span various industries, including finance and real estate (48 companies, which is 36% of the filings), services (30 companies, 22.6%) and manufacturing (23 companies, 17.3%)
- A significant number of mature companies are participating in Reg A+; the oldest firm has been operating for 37 years and 22 of the 133 firms have been in business for 10 years or longer
- Most Reg A+ filings come from the largest states around the country, including California (34 firms), New York (9 firms), Illinois (7 firms), Florida (14 firms), and Texas (7 firms) – with little participation from firms in the Southern states (16 firms in total from the region)
- 54 companies filed under Tier 1, which allows them to raise up to $20 million
- 77 companies filed under Tier 2, which allows them to raise up to $50 million but requires a financial audit
“The new Reg A+ regulations have opened new opportunities for companies looking for alternative funding options,” said Richard Swart, NextGen Chief Strategy Officer and author of the new report. “The wide distribution of firms involved across industries is a positive sign. It’s a strong indication that these new rules are attractive to business owners and investors alike.”
In addition to this Reg A+ data, NextGen also tracks data on Title III / Regulation Crowdfunding campaigns, including summary progress of crowdfunding companies as well as detailed progress of individual companies. Introduced in May 2016, Title III Regulation CF allows companies to raise up to $1 million from both accredited and non-accredited investors. This data is available for free (with registration).
Since launching last year, NextGen has worked to educate investors about equity crowdfunding and to highlight companies seeking to raise funds through the new rules with live webinars, in-person events and its Crowdfunding Dashboard which tracks data on Title III / Equity Crowdfunding campaigns. The next event featuring companies leveraging recent crowdfunding rules is set to take place on Wednesday, November 2 and will be live-streamed online at http://www.nextgencrowdfunding.com/. NextGen provides investors, intermediaries and issuers with crucial information about the new regulations and information on how the equity crowdfunding industry is growing. For more information, visit http://www.nextgencrowdfunding.com/.
To download a PDF of the full Reg A+ report, please click here.
About NextGen Crowdfunding, LLC
NextGen Crowdfunding helps people explore the new era of investment crowdfunding. Through unique, live online events, NextGen enables individuals to discover, follow and support companies launching crowdfunding campaigns. NextGen’s unique Ignition™ Events showcase the companies and emerging businesses presenting investment crowdfunding campaigns. NextGen also provides educational content, including online webinars, boot camps and videos, to inform the public about crowdfunding. NextGen also provides education to, and visibility for, companies with crowdfunding campaigns. As a purpose-driven company, NextGen aims to encourage entrepreneurship and help spark a new economy. Visit www.nextgencrowdfunding.com.