Debrief of yesterday's talk

Quick debrief of the event yesterday at the SURF Incubator for the Seattle Angel Conference, about the possible convergence of angel investing and crowdfunding:

  • Several indications from workshop participants that the effective lowering of the average investment per deal correlates strongly with getting more people who meet the accredited investor standard into the private investing pool.
  • From the entrepreneur's perspective, one would rank the different types of crowdfunding in the following order of priority: (1) donation, rewards-based (or Kickstarter-like) crowdfunding; (2) angel crowdfunding under Title II of the JOBS Act; and (3) Title III crowdfunding, if in fact there were such a thing.

Views west and east from SURF

  • I pressed that Title III crowdfunding is not workable, and got no pushback. The points that the legislation requires business plans and reviewed or audited financial statements, those were probably the most compelling.
  • Different practices in accredited investor verification were raised: who performs it; how extensive is it; in the platform context, how important is it that the process is separate from the pitching of a given deal.
  • Even though the ban on general solicitation has not yet been lifted, angel platforms move ahead, relying on Title II.

Pictured are views from the SURF Incubator offices on Second Avenue in downtown Seattle, looking west and east respectively.

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