Reg A+: Raise up to $50 Million for Your Company From All Investors - Part 1
If you are planning to sell security tokens or conduct a security token offering (STO) to raise money for your company, you have to either register your offering or find an exemption to registration.
A registered offering allows you to sell your tokens to an entire spectrum of investors, regardless of their income or net worth. However, registered offerings are extremely expensive--a million dollars or more--and not feasible for emerging startups.
Instead of registering an offering, early stage companies generally find an exemption to registration to raise the money they need. One of these exemptions is Regulation A+. This exemption allows a company to raise money from investors regardless of their income or net worth.
Specifically, you can raise up to $50 million under Regulation A+. You can even “test the waters” to see if investors are interested in your offering. This means you can advertise your offering to see if investors are interested before filing a single document with the SEC. This can save you a lot of money in preparing your offer just to find out that investors are not interested in investing in your company.
In the next post, we will go over the two tiers of Regulation A+ and why you may consider one over the other.
If you have questions, we are here to help. You can schedule a free strategy session with us by clicking here.
This article is provided for informational purposes only and should not be construed as legal advice. Read our disclaimer here.