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May 22, 2013

Wisconsin Department of Financial Institutions Issues Advisory on Crowdfunding

Michael Best & Friedrich LLP
Gregory J. Lynch
Michael Best & Friedrich LLP
Wednesday, July 18, 2012
Administrative & Regulatory / Financial Institutions & Banking / Labor & Employment / Securities & SEC
Wisconsin
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In April 2012, President Obama signed the JOBS Act into law. One of the more interesting provisions for emerging companies was the crowdfunding exemption from federal and state securities regulations.  Under the JOBS Act, the Securities and Exchange Commission (SEC) was required to issue regulations in December 2012 (whether the SEC meets this deadline is in doubt).

The Wisconsin Department of Financial Institutions (DFI) recently issued a Small Business Advisory reminding companies that the crowdfunding provisions under the JOBS Act are not yet applicable and will likely not be applicable until 2013.  Further, the DFI release has some very sound practical advice on crowdfunding, such as:

  • risks that crowdfunding may hinder future investment;
  • the merits of looking at other exemptions;
  • the emphasis on disclosure; and
  • choosing a strong team, including a reputable funding portal.

We will continue to comment on updates on the crowdfunding exemption as new information becomes available later this year.

© MICHAEL BEST & FRIEDRICH LLP

About the Author

gregory j. lynch, member, michael best law firm
Gregory J. Lynch
Member

Greg Lynch is the Chair of the firm’s Transactional Practice Group and a member of the Renewable Energy Industry Group. He also is the Co-Founder of the firm’s VentureBestSM venture practice. His principal experience has been in the following areas:

  • Early-stage company formation
  • Angel and venture capital financing
  • Public and private placement of securities
  • Stock option and equity incentive plans
  • Business plan review and advice
  • Mergers and acquisitions
  • General corporate law,...
gjlynch@michaelbest.com
608.283.2240
www.michaelbest.com

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