Crowdfunding Industry Forms Leadership Group to Pursue Development of Industry Self-Regulatory Organization

Investor Protection, SEC Collaboration and Market Integrity Top the Agenda

WASHINGTON--()--Today as President Obama signed the JOBS Act into law, a group of 13 equity and debt crowdfunding platforms and industry experts announced a leadership group to pursue the development of self-regulation for the crowdfunding industry. The JOBS Act requires that all equity and debt crowdfunding platforms be a member of a national securities association. This leadership group, CFIRA (Crowdfund Intermediary Regulatory Association) will explore the various paths to meet that requirement in ways that protect investors and support a vibrant industry. The leadership group will include members of the crowdfunding industry itself in collaboration with legal, securities and SEC experts; many of which were leading the charge to advocate for the legislation. The group sent a letter to President Obama regarding its intent.

Crowdfunding will provide the opportunity for regular Americans to invest small amounts of money in businesses they know and entrepreneurs they believe in. According to Kauffman Foundation research these small companies are the source of net new jobs in the economy. Crowdfunding is not a new concept. Reward or perk-based crowdfunding has been successfully raising capital for several years.

“The rapid formation of this leadership group demonstrates how focused the crowdfunding community is on protecting investors as they navigate this new class of investments,” said Karen Kerrigan President & CEO of the Small Business & Entrepreneurship Council. “We look forward to the impact Crowdfunding will have on increasing jobs and American innovation.”

The goal of the leadership group is to agree upon a standard set of principles as well as explore the development of a robust industry regulator. This group will also begin to collaborate with the SEC in its nine-month rule making process to enact the rules for crowdfunding. The group will create principles to:

  • Establish strong protections for investors in the form of an Investor's Bill of Rights, including tests to assess investors understanding of risk, criminal background checks on issuers, and adequate disclosures by issuers;
  • Ensure confidentiality of investors’ personal financial information;
  • Ensure that investors do not exceed statutory investment limits by implementing standardized reporting and communication among platforms;
  • Establish standard communication processes for transparent flow of information between the issuer, the investor, the intermediary and the regulatory agency;
  • Develop a code of conduct for crowdfunding platforms, with enforcement mechanisms to punish bad actors;
  • Create a recognizable brand common to trustworthy intermediaries (akin to VeriSign or BBB).

“After 15 months of hard work, we are very excited that equity and debt crowdfunding will soon be active in the United States. We deeply appreciate the leadership that The President has provided on this issue and we thank the House and Senate for engaging with us in crafting this legislation. Now is the time to ensure that all the good intentions of this legislation can be written into regulation that protects investors and enables a strong crowdfunding market to form,” remarked Jason Best co-author of the CrowdFund Investing Framework in the JOBS Act and a founding member of the leadership group.

“The availability of crowdfunding as a capital formation option for entrepreneurs and small businesses is a huge opportunity for our economy to create innovative new products and services,” said Carl Esposti, founder of and leader of the CAPS Accreditation Program for crowdfunding platforms and a founding member of the leadership group.

This leadership group will build a united industry voice that will focus on: collaborating with the SEC, educating investors and entrepreneurs, being a strong industry advocate and building a vibrant crowdfunding community. The group will hold monthly meetings and must work carefully and without delay to help launch crowdfunding in the U.S. so entrepreneurs can innovate and create new jobs.

Join a Live Chat at 5pm GMT / 12pm EST / 9am PST on Monday, the 9th of April on with the leadership group behind the initiative to define a regulatory framework for the crowdfunding industry - post any topics you would like the group to address here: - follow this link to register or to read more about the Live Chat session:

Founding leadership group members (in alphabetical order) include:

  • CAPS Crowdfunding Accreditation Program
  • Crowdfunder
  • Funding Roadmap
  • GATE Technologies & GATE Impact
  • Indiegogo
  • Launcht
  • Motaavi
  • RocketHub
  • Soho Loft Capital Creation Events
  • SoMoLend
  • Startup Exemption
  • Wefunder
  • The founders of ProFounder Dana Mauriello & Jessica Jackley

About the group leaders (Startup Exemption)

Jason W. Best, Zak Cassady-Dorion and Sherwood Neiss are the co-authors of the CrowdFund Investing (CFI) framework. This framework was proposed as an exemption under Regulation D Securities Offerings to allow startups and small businesses to raise a limited amount of seed and growth capital from their social networks using SEC-registered websites. The framework was in line with the two Crowdfunding bills passed by Congress as well as President Obama’s proposal, passing the U.S. House on November 4, 2011 (407-17) and the U.S. Senate on March 22, 2012 as part of the JOBS Act (73-26). As leaders of the legislative change for Crowdfunding in Washington, they are very pleased to collaborate with industry experts in forming this leadership group. For more information visit:

Media Contacts: Jason W. Best (415) 999-2271, or Sherwood Neiss - (202) 247-7182,

About the CAPS program

The Crowdfunding Accreditation for Platform Standards (CAPS) program, an initiative by, establishes standards for a wide range of crowdfunding operations, including both equity-, debt-, and donation-based portals, and aims to protect investors from fraud and to promote best practices for crowdfunding portals. CAPS-accredited platforms are those that have met qualification criteria in four areas: operational transparency, security of information and payments, platform functionality, and operational procedures. Amendments or changes to the standards are voted in quarterly by the CAPS Council - the governing body of the program.

Media Contact: Jennifer Moebius (617) 922-8004,

CAPS Program Director: Kevin Berg Grell, PhD,

About Crowdfunder

Crowdfunder is the Business Crowdfunding platform that will enable U.S. startups and small businesses to raise funds through equity and revenue-based investment. For more information visit:

Media Contact: Jean-Michel Arnoult, (347) 804-8359,

About Funding Roadmap

Funding Roadmap business plan and due diligence reporting system on-the-cloud provides real-time planning, reporting, analysis, compliance, transparency and GAAP compliant financial statements. It gives you a simpler and easier way to comply with individual state and national security laws and future reporting as you successfully crowd fund your business on any crowdfunding site.

Media Contact: Ruth Hedges (213) 276-6266,

About GATE Technologies

GATE Technologies is an innovative financial technology company creating a new market infrastructure for bringing efficiency, transparency to the unstructured global alternative asset markets. The company offers fully automated, customizable solutions for qualified investors with value-added content and analytics, transparent execution, and dematerialized settlement, clearing, and depository functions. GATE Developing Markets will work to create the first global common infrastructure for illiquid securities, with a goal of enabling all market participants to buy and sell transferable securities.

Media Contact: Vincent R. Molinari (646) 449-7990,

About Indiegogo

Indiegogo is the leading global platform for crowdfunding, empowering anyone, anywhere, to raise money for anything. Millions of dollars each month are raised on Indiegogo and almost every country in the world has been represented. Founded in 2008, the company has appeared on OprahToday, and the BBC, as well as in the Wall Street JournalThe Guardian, and The New York Times. Indiegogo is headquartered in San Francisco, CA with offices in Los Angeles, CA and New York, NY. For more information, visit and follow at and

Media Contact: Rose Levy, Goldin Solutions 646-660-8641

About Launcht

Launcht creates white label crowdfunding platforms and technology solutions for the donation and future equity crowdfunding industries. Launcht also hosts a crowdfunding marketplace for social entrepreneurs. For more information, visit

Media Contact: Spencer S. Taylor (802) 238-0319,

About Motaavi

Motaavi will be an integrated trading platform and exchange where anyone can invest and trade shares of early stage companies. To learn more about the platform, visit:

Media Contact: Melanie Plageman (513) 680-2653,

About RocketHub

RocketHub is one of the world's top donation-based crowdfunding platforms that has been featured in the Wall Street Journal, The New York Times, NPR, Wired, The Economist, CNN, The Washington Post, ABC News, USA Today, etc. while helping thousands of rewards based funding campaigns raise millions of dollars. For more information, visit

Media Contact: Brian Meece (646) 761-2205,

About Soho Loft Capital Creation Events

The Soho Loft Capital Creation (TSLCC) Event Series is the only global event platform where accredited investors; accomplished angels; microfinancing groups; CIOs of investors; select merchant and investment bankers; VCs; family offices; incubators; private equity firms; pre-IPO mutual funds; secondary stock specialists; seasoned entrepreneurs; tax and legal experts and equity analysts from across the world assemble in order to exchange ideas, discourse and opportunities that will help reshape the capital markets and stimulate economic growth. Our mission is to help develop the infrastructure of the rising private markets so that it can mature into a viable and functional marketplace that facilitates capital formation, innovation, expansion and job creation. For additional information please visit us at and

Media Contact: Dara Albright (770) 880-0801,

About SoMoLend

At SoMoLend, we make investing in your online community simple, affordable, and social. SoMo is a Web and mobile-based peer-to-peer lending website that uses patent-pending lending technology executed within a hyper-localized geographic scope to connect small-business borrowers with individual and organizational investors. SoMo's user-friendly technology allows business borrowers to raise capital from friends and family, customers and community supporters as well as from Facebook, Twitter and LinkedIn connections. Investors lend money directly to borrowers through the SoMo platform, which then packages the loans and sells them as notes, bypassing banks and credit-card issuers. For more information, visit and

Media Contact: Candace Klein (859) 803-9499,

About Wefunder

Wefunder will revolutionize how startups start and grow. We will give all Americans the opportunity to invest in companies they believe in, and own a piece of the journey to success. For more information, visit

Media Contact: Michael Norman (401) 477-3647,


Startup Exemption
Jason W. Best, 415-999-2271
Sherwood Neiss, 202-247-7182


Startup Exemption
Jason W. Best, 415-999-2271
Sherwood Neiss, 202-247-7182