Tre experter, tre svar: Hur man hanterar motstridiga råd från Reg A+
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When three experts give you three different answers on a Regulation A+ question, there is more work to do. I dig deeper rather than treating any one answer as the verdict. Even advice that every advisor agrees on can fall behind as SEC practice evolves.
Founders and CFOs assembling an advisory team can run into conflicting guidance from securities attorneys. This article describes how I think about that situation. It is a decision process, not a legal conclusion.
What Conflicting Reg A+ Legal Advice Tells You
When you speak to three experts and you get three different answers, you have more work to do. In my experience, that happens often with securities attorneys. I have been in many situations where the advice I received was contradictory, and I have had to dig deeper.
I treat that kind of disagreement as information that the question needs more work. I do not treat it as a verdict. For context, Reg D, Reg A+, and Reg S each have nuances, and in my experience Reg A+ has the most.
Weighing conflicting advice on your Reg A+ raise? Talk to an MSC strategist.
A Case Where Long-Standing Advice Changed
Companies sometimes run a Reg D offering alongside a Reg A+ offering, or use bonus shares, to give large investors advantageous terms so that institutional investors will participate.
For many years, the best securities attorneys told me the same thing whenever a company wanted to run both offerings at the same time. If the company is selling the same security in both, they said, it should have the same share price. The SEC would not allow even the smallest share price differential
Then I saw an instance where a company ran both Reg D and Reg A+ offerings with deep discounts available for Reg D investors that invested huge amounts of capital. In the Reg A+ offering, discounts are delivered via bonus shares, which work as an effective discount - the max discount the SEC allows by this method is 20%. An institutional investor putting in millions of dollars demands a much lower share price than an investor putting in $300.
SEC practice has evolved to allow companies to follow that model of discounting for institutional investors via the Reg D. This is now common practice. Not everyone knows this.
What Evolving SEC Practice Means for Advice
The advice in that case came from the best securities attorneys, and it still fell out of step with SEC practice. SEC practices evolve.
Vanliga frågor om partihandel med mat och dryck
What does it mean when securities attorneys give different answers on Reg A+?
When I get conflicting answers from securities attorneys, I treat it as a sign that there is more work to do, and I dig deeper before making a recommendation to my customer CEO.
Why can Reg A+ advice conflict?
SEC practices can evolve, and there have been situations where long-standing advice no longer matched up-to-date practice. Some attorneys were up to date, some were not.
Frågor?
Mejla oss på [e-postskyddad] med eventuella frågor. To hear more, watch the full episode, where Rod Turner joins Jason Fishman on Testa. Optimera. Skala.
Mejla oss på [e-postskyddad] med eventuella frågor.
Om författaren
Grundare och VD, Manhattan Street Capital
Rod Turner är grundare och VD för Manhattan Street Capital, där han byggde plattformen som företag i tillväxtfas använder för att genomföra Regulation A+-löneförhöjningar online.
Han har tidigare varit med och byggt upp Symantec/Norton, Ashton Tate, MicroPort och Knowledge Adventure, och byggt upp riskkapitalbolaget Irvine Ventures, där han investerat i företag som Bloom, Amyris, Ask Jeeves och eASIC.
Kommentarerna på den här sidan återspeglar Rods observationer av vad som tenderar att fungera inom online-marknadsföring för kapitalanskaffning. Det är inte juridisk, redovisningsmässig eller investeringsrådgivning.
Manhattan Street Capital är inte en advokatbyrå, värderingsbyrå, försäkringsgivare, mäklare eller Title III crowdfunding-portal och bedriver inte någon verksamhet som kräver sådan registrering. Manhattan Street Capital tillhandahåller inte investeringsrådgivning och strukturerar inte transaktioner. Tolka inte kommentarer från Manhattan Street Capitals personal som en ersättning för råd från kvalificerade tjänsteleverantörer inom dessa yrken. När Rod Turner ger kommentarer baseras det på hans observationer av vad som fungerar och vad som inte fungerar ur ett marknadsföringsperspektiv i online-erbjudanden; han talar inte om för läsarna vad de ska göra, bara vad som är mest sannolikt att marknadsföras kostnadseffektivt online. Alla beslut om villkoren för ett erbjudande fattas av de företag som gör dessa erbjudanden.
