Some US States don't allow companies without a Broker-Dealer involved with their Reg A+ to raise capital. Which are they and what are my options?
The so-called "Problem States" are these: Texas, Florida, Washington, New Jersey, Nevada, Arizona and North Dakota. As a group they account for ~16% of the US online active investing market with Texas (6%) and Florida (4%) in the numbers one and two positions. Of course, all investors from outside the USA are allowed to invest even when you do not have a Broker-Dealer.
Using a Broker-Dealer in a Regulation A+ offering is optional. If you use a national FINRA approved Broker-Dealer, then you automatically are allowed to raise capital from all US States. FINRA sometimes introduces significant delay in getting the Reg A+ Qualified to go live. This schedule uncertainty has caused some companies to avoid using a Broker-Dealer. Manhattan Street Capital works with specific broker-dealers that provide very cost effective fee arrangements in which they will provide the benefits of State exemptions for the problem states. without needeing to file with those statesIt is possible to work with a securities attorney and file for your company in all or some of the "problem states" - but this journey takes time and effort. When started early in the Reg A+ process, this can result in a cost effective solution that does not require you to pay broker-dealer fees.
A special note to Florida-based companies. Our securities attorneys have advised (as of Summer 2019) us that FL now requires companies that are based in the state to file and receive FL state permission to condusct a Reg A+ to investors that reside in any US state. So for Florida based companies it is a bigger concern than for companies in other states.