The Securities and Exchange Commission recently published its report on the Government-Business Forum on Small Business Capital Formation, which generates recommendations from participants that the SEC considers. The recommendations from participants included, among others, the following:

  • Expand the accredited investor definition to achieve greater diversity among startup investors and entrepreneurs,
  • Expand the accredited investor definition to include additional measures of sophistication,
  • Harmonize the annual reporting requirements for issuers that utilize different exempt offering alternatives, like Regulation A and Regulation Crowdfunding,
  • Collaborate with market experts to establish a regulatory framework for finders that includes an exemption from broker-dealer registration and helps facilitate small business capital formation,
  • Allow non-accredited investors to participate in venture capital funds,
  • Increase the number of investors allowed in 3(c)(1) funds, and
  • Improve public trading for small companies by requiring more disclosures about short selling, institutional holdings, insider and affiliate holdings and transactions, etc.

The full report is available here.