My lawyer friend let me know about some interesting advice that I figured I would pass along to fellow Texas residents. Crowdfunding is coming to the Lone Star State...
Huh?
That was my response, too. Then I did some digging and it made sense.
So what is crowdfunding, exactly? I'll try to explain in layman's terms....
As best described by one business portal that is set to help with the process, new rules have allowed any average joe investor to get in on funding startups and other business ideas.
As an example, a restaurant wants to sell a 10% equity in their company to raise money to buy new patio furniture. Previously, this would be a very convoluted process (involving well-connected heavy hitting investors only, in most cases) that most people wouldn't have a chance to get involved in.
New crowdfunding rules change that. Much in the same way a band can raise money via Kickstarter to buy a new van for their tour, people will be able to invest in new business ideas and other investments.
This is interesting for a number of reasons and should open up a wave of new business opportunities that were not possible up until now. It allows the common man to become a "VC" or "angel investor" in a way. Again - terms that were not possible for 98% of the population until recently.
Basically, via a business portal such as the afore-mentioned Lone Star Crowdfunding - investors connect with entrepreneurs selling stock in their ideas. If my understanding is correct.
Are there limits? Yes, but they aren't restrictive. New businesses can raise up to $1 million a year from the public. Not too shabby.
I've probably butchered it a little but that's the general gist. It's an exciting new era for business development in Texas, thanks to new regulations that will come into play in 2015.
Huh?
That was my response, too. Then I did some digging and it made sense.
So what is crowdfunding, exactly? I'll try to explain in layman's terms....
As best described by one business portal that is set to help with the process, new rules have allowed any average joe investor to get in on funding startups and other business ideas.
As an example, a restaurant wants to sell a 10% equity in their company to raise money to buy new patio furniture. Previously, this would be a very convoluted process (involving well-connected heavy hitting investors only, in most cases) that most people wouldn't have a chance to get involved in.
New crowdfunding rules change that. Much in the same way a band can raise money via Kickstarter to buy a new van for their tour, people will be able to invest in new business ideas and other investments.
This is interesting for a number of reasons and should open up a wave of new business opportunities that were not possible up until now. It allows the common man to become a "VC" or "angel investor" in a way. Again - terms that were not possible for 98% of the population until recently.
Basically, via a business portal such as the afore-mentioned Lone Star Crowdfunding - investors connect with entrepreneurs selling stock in their ideas. If my understanding is correct.
Are there limits? Yes, but they aren't restrictive. New businesses can raise up to $1 million a year from the public. Not too shabby.
I've probably butchered it a little but that's the general gist. It's an exciting new era for business development in Texas, thanks to new regulations that will come into play in 2015.
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