Actor and comedian Milton Berle is quoted as saying, “If opportunity doesn’t knock, build a door.” In the past, the knock of opportunity never came for many potential investors because of rules that limited investment opportunities to the very wealthy. Even if you had the foresight to invest in an idea that would become the next big thing, chances are you would not have had the opportunity. Luckily, change is coming. A door has been built to democratize investing, and it is known as Regulation A+.
While many are familiar with crowdfunding websites Kickstarter and Indiegogo, Regulation A+ has not yet become a household name. Regulation A+ is a product of the JOBS (Jumpstart Our Business Startups) Act, which passed in 2012 with bipartisan support. Prior to changes in Regulation A+, investment opportunities in startups were limited to accredited investors, who make up less than 1% of the U.S. population. According to The Motely Fool, thanks to Regulation A+, “investors with assets worth less than $1 million or with less than $200,000 in annual income can invest in private companies before they go public.”
Regulation A+ has the potential to be universally beneficial. Individuals who are not accredited investors now have the freedom to get in on the ground floor of a burgeoning enterprise. For entrepreneurs, Regulation A+ can be a great source to secure the necessary capital to take their next big step. There is also a combined benefit for both investors and entrepreneurs. Crowdfunding has allowed individuals to support causes they believe in and Regulation A+ allows them to do so on a much larger scale as investors.
Additionally, the economy as a whole stands to benefit from Regulation A+. According to Forbes, “65% of the net new jobs are created by small businesses while 1 million jobs are cut each year by large corporations.” Regulation A+ has received a broad groundswell of support and there has even been a declaration of support by a member of Congress. Regulation A+ can help jumpstart startups and create American jobs in the process.
Entrepreneurs are dreamers at heart and there is much that goes into making their dreams a reality. Now, more than ever, individuals can contribute in seeing an entrepreneur’s dream come to fruition. Regulation A+ has the potential to democratize investing and be mutually beneficial to both investors and entrepreneurs. Regulation A+ is the figurative door that Milton Berle described, and the knock of opportunity has arrived.