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  1.  
  2. LEGAL/CORPORATE STUFF
  3. Selling Stock -- SEC Rules
  4. Ask The VC: How Can An Entrepreneur Fundraise Without Getting In Trouble With the SEC?
« Rule 144 – Reg D Rule 506, Venture Capital, Angel Investment, Go Public Today, Private Investors
Sharing Equity in a Startup or Established Entrepreneurial Venture »

Ask The VC: How Can An Entrepreneur Fundraise Without Getting In Trouble With the SEC?

27 Sep 2008   | Selling Stock -- SEC Rules

Tags: accredited investor · legal

LINK TO ORIGINAL ARTICLE:
  • http://www.askthevc.com/blog/archives/2007/10/how-can-an-entr.php

There is a simple legal answer to your question: this type of behavior that you and your colleague are discussing is an illegal solicitation under the law. Note, that I’m assuming that people you are contacting are not accredited investors. If the people that you are contacting are not accredited investors, you don’t have an exemption under the SEC’s interpretation of the law. It’s irrelevant whether or not you have a pre-existing relationship with anyone and irrelevant whether or not you have a PPM or term sheet present in the discussion. Your intent is to solicit investment and that’s sufficient to be considered an offering.

>>> READ MORE at:
  • http://www.askthevc.com/blog/archives/2007/10/how-can-an-entr.php
« Rule 144 – Reg D Rule 506, Venture Capital, Angel Investment, Go Public Today, Private Investors
Sharing Equity in a Startup or Established Entrepreneurial Venture »

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