Your easiest options are these; Reg D, Reg S, Rule 144A,
In many ways, the most attractive option is Reg A+, but you must establish a US or Canadian entity to use Reg A+, see below.
Regulation A+
Regulation A+ allows startups and mid-stage companies to use equity crowdfunding platforms (such as Manhattan Street Capital) to raise as much as $75M from both accredited and non-accredited investors. Reg A+ is broken up into two tiers, Tier 1 and Tier 2. Tier 1 allows you to raise up to $20M, while Tier 2 allows you to raise from zero to $75M.
This means that start-ups and growing businesses don’t need an angel investor worth millions or billions of dollars to help take their company to the next level. Regulation A+ dramatically improves the funding prospects for companies that are too small to make a regular IPO on the NASDAQ, for example, or which do not have access to a Private Placement or to Venture Capital. It completely changes the prospect of raising capital, giving start-up, mid-stage, and late-stage companies the opportunity to raise capital from many smaller, individual investors, who become owners of shares in the company. While of course, Angel investors and professional investors are encouraged to invest too.
If you set up legal Headquarters for your company in the USA or Canada then you are allowed by the SEC (Securities and Exchange Commission) to use Reg A+ to raise capital. Most companies that take this route set up a "C" Corporation in Delaware, but you can also set up an LLC or a Limited Partnership. We can introduce you to good attorneys.
If most of your investors will come from your country and few from the US, then using a Tier 1 Reg A+ can be a very good fit. The advantages of Tier 1 are that you do not have to file an Audit with the SEC and you do not have to make revenue and profit reports every six months after your offering completes. The big advantage of Tier 2 is that when you raise money from investors in US States, you do not have to satisfy the US State's Blue Sky regulations, which makes the process faster and simpler. If you will raise capital from US investors in multiple US states, then Tier 2 is the best method to use because dealing with the US states is far easier in Reg A+ Tier 2. Tier 2 offering size range is from zero to $75 mill per year.
You can list your company on the NASDAQ, NYSE, on the OTCQB or the OTCQX, or choose not to list your company at all. The SEC allows the investors in Reg A+ offerings to sell their shares after the offering. Your company can choose to lock the shares or to provide alternative forms of liquidity. The investors in a Reg A+ offering can come from anywhere in the world.
Related pages:
Timeline schedule for a typical Regulation A+ offering
Timeline schedule for a Reg A+ IPO to the NYSE or NASDAQ
Regulation D & Regulation S (often used together)
With a Reg D (506c) offering, the company can raise an unlimited amount of capital, but only from accredited investors. It is allowed for the issuing companies to promote and advertise their offerings. The issuer companies have to take steps to verify that the investors are actually accredited. Although the companies don't need to register with the SEC, they have to file a Form D, which includes information about the company's offering, promotors, the companies themselves, and some further information about the offerings.
Reg S can be a good compliment to Reg D and to Rule 144aA, in that Reg S allows non-US investors to invest in a US company on a similar basis to the Reg D or Rule 144A terms, without the need to be accredited investors.
Regulation S provides an SEC compliant method for company capital offerings that are made outside the U.S by both foreign and U.S issuers. Regulation S, which was adopted by the Securities and Exchange Commission (the “SEC”) in 1990, provides that offers and sales of securities that occur outside of the United States are exempt from the registration requirements of Section 5 of the Securities Act of 1933 (the “Securities Act”).
Related pages:
Rule 144A
Rule 144A® (Certain uses have been patented by us) is a capital-raising method that can be offered and marketed online to Institutional investors in the US and any investor outside the US via Reg S. It is simple and offers the Issuing company the ability to publicly list its security post offering for public trading by US Institutional investors. Non-US companies are able to use Rule 144A.
Manhattan Street Capital's role in the capital-raising process
Our first step is to help companies assess if Reg A+ (and in select cases, Reg D and Reg S) is a good fit for their business and funding needs. Besides conventional offerings, we also host and consult for STOs on our platform that use Reg A+, Reg D or Reg S, to be securities rules compliant offerings.
We assist companies through the whole capital raising process to achieve a successful offering. Our website technology integrates the necessary services so companies can make their offering work efficiently on Manhattan Street Capital. Every investor goes through an AML check, and Accreditation Verification process if required.
We provide some services directly, others we provide by introducing client companies to specialized service providers: Specialized Marketing agencies, Legal, Broker/Dealer, Investment Banks, Underwriters, Market Makers, escrow, transfer agent, markets (NASDAQ, NYSE, OTC Markets) and auditors.
Among services that we provide through Manhattan Street Capital are; Consulting, Project Management and Coordination and of course Listing Company Offerings. We have developed unique proprietary AI technology that improves the process and the results of our online listing services. We are selective and we add value to the offerings that we assist with.
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Rod Turner
Rod Turner is the founder and CEO of Manhattan Street Capital, the #1 Growth Capital service for mature startups and mid-sized companies to raise capital using Regulation A+. Turner has played a key role in building successful companies including Symantec/Norton (SYMC), Ashton-Tate, MicroPort, Knowledge Adventure and more. He is an experienced investor who has built a Venture Capital business (Irvine Ventures) and has made angel and mezzanine investments in companies such as Bloom, Amyris (AMRS), Ask Jeeves and eASIC.
www.ManhattanStreetCapital.com
Manhattan Street Capital, 5694 Mission Center Rd, Suite 602-468, San Diego, CA 92108. Phone 1 858 366 2585