For past five years, we have practice Rewards CrowdFunding Marketing, promotion , crowd building support and services in order to learn DNA of CrowdFunding and get ready to "Equity CrowdFunding" . In our Journey we learned about Ben & Jerry local CrowdFunding or so called "direct public offering " or DPO. Thousands of companies have successfully used DPOs to raise capital from the crowd. Ben & Jerry’s, Annie’s Homegrown, and Real Goods are just a few household names that have used DPOs in the past. What is DPO ? A DPO is similar to an initial public offering (IPO) in that stock is sold to investors, but unlike an IPO, a company uses a DPO to raise capital directly and without a firm underwriting from an investment banking firm or broker-dealer. A DPO will generally have a sponsoring FINRA broker, but in the case of a DPO, the FINRA broker does not guarantee full subscription of the offering. In this instance, the broker merely assures compliance with all applicable Securities and Exchange Commission (SEC) rules that the offering must comply with. Following registration with the SEC and subject to compliance with state blue sky laws, a company can sell its shares directly to anyone, even non-accredited investors, including customers, employees, suppliers, distributors, family, friends and others. Ben & Jerry’s were pioneers of DPO and were able to grow their company . They did not rely on finding angel or venture capital investors; they underwrote themselves and self-administer public securities offerings to both accredited and non-accredited investors. They were allowed to market and advertise the offering through any venue they choose. Now with Reg A+ “Tier 1 requires SEC and state blue sky reviews and fees, can raise up to $20M per year, open to unaccredited investors, and no audit required.” Posted: David Khorram - CrowdFundingPlanning.com CKO and Senior mentor at www.CrowdFundingMentors.com |