3 Things You Need To Know About the New Crowdfunding Rules

The new SEC Regulation A+ has the potential to completely change the way real estate crowdfunding operates, which already has been a disruptive force in the market. Here are the 3 things you really need to pay attention to from the lengthy regulation.

 1. More People In The Pool

Regulation A+ allows companies to raise up to $50M per year from non-accredited investors (in other words, people who are not high-net-worth investors). RealCrowd CEO Adam Hooper tells us that's huge, as it will open the door to millions of new investors.

2. A New Beginning

The US has witnessed a tremendous change in how private capital can be raised with the adoption of Title II of the JOBS Act and the creation of the 506(c) offering framework. And Adam says the new regulation may have just as big of an impact, giving crowdfunding a shot at the rapid growth some thought was only possible in the early stages. A Crowdfund Capital Advisors study found that crowdfunding had positive effects on job growth, revenue for entrepreneurs, and follow-on interest from institutional investors, economist John Berlau (above) told us last year.

3. Less Burden

Flaster/Greenberg attorney Mark Roderick told us the Internet's arrival in real estate funding could unlock $3.5T in potential investment, and Regulation A+ allows for some offerings to be filed only with the SEC versus in every state, which is much less burdensome for issuers. This could give commercial RE operators who have been on the fence about utilizing crowdfunding for online syndication a reason to take another look.

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