Comment by 7Figures2Commas | Hacker News Reader

Comment by 7Figures2Commas | Hacker News Reader

Parent Full thread

7Figures2Commas

Obviously "healthy, high-caliber" means different things to different people.

As for how the market is behaving: I have personally heard several attorneys state that they're advising their clients to be very cautious about Rule 506(c) and according to media reports[1], this is the advice of many attorneys.

I am aware that companies are relying on Rule 506(c) for offerings on AngelList and services like yours, but in terms of the overall market for Regulation D offerings, this is a still a small number.

> I disagree with your interpretation of the intention of the JOBS Act.

You cited the $1 million cap as an example of a rule that is of concern to you. To my knowledge, this cap was an explicit part of the bill that Congress passed. As such, I don't see how the SEC could eliminate that restriction.

[1] http://www.crowdsourcing.org/editorial/ban-on-general-solici...

> Obviously "healthy, high-caliber" means different things to different people.

That's true, there's definitely subjectivity here. I make the assumption that YC companies are a proxy for "healthy, high-caliber" startups and my opinion of what will be deal breakers for that category of company is shaped by our customer development in the YC network. I could be wrong for a few reasons.

> As for how the market is behaving: I have personally heard several attorneys state that they're advising their clients to be very cautious about Rule 506(c) and according to media reports[1], this is the advice of many attorneys.

Indeed. I think there's a natural lean for attorneys to be more conservative and wait for things to play out a little. I believe that in the next year or two it will be commonly accepted, I've already seen a lot of attitude change over the past year. We'll see. I think this is something startups ultimately want - assuming all the concerns can be addressed. More fundraising options and a wider pool of value-add investors is a good thing if crowdinvesting can be done practically, IMO.

> You cited the $1 million cap as an example of a rule that is of concern to you. To my knowledge, this cap was an explicit part of the bill that Congress passed. As such, I don't see how the SEC could eliminate that restriction.

I did, in the 585 page document the SEC released they suggest a few adjustments to address the concerns people have. For example, the $1m limit might be applied to the fees collected by the funding portal.

Reply on news.ycombinator.com