Introduction p. xv
The Road Map: "Where to Find Detailed Discussion of Regulation Crowdfunding p. xix
Part 1 The Basics of Crowdfunding
Chapter 1 What is Crowdfunding? p. 3
Taking the Friends-and-Family Offering to the Next Level p. 4
The Different Types of Crowdfunding p. 5
Who Should Be Reading This Book? p. 10
Where This Book Will Take You p. 11
Chapter 2 The Evolution of Crowdfunding p. 13
The Friends-and-Family Offering p. 13
Intermediate Steps: Microlending and Peer-to-Peer Lending p. 14
The Social Media Revolution p. 15
Kickstarter.com and Project Crowdfunding p. 16
Angel Investor Social Media Websites p. 17
Intrastate Crowdfunding Under State Law p. 17
Social Media Crowdfunding (Title III Crowdfunding) p. 18
A Brief Overview of Crowdfunding Under Title III of the JOBS Act Regulation Crowdfunding p. 21
Part 2 Launching A Successful Title III Crowdfunded Offering, Step By Step
Chapter 3 Is Crowdfunding Right far Your Company? p. 29
Crowdfunding Is Not for Everyone p. 29
Is Your Company Right for Crowdfunding? p. 30
Qualifying Under the JOBS Act and Regulation Crowdfunding p. 32
Handling Your Crowd of Investors If the Offering Is Successful p. 33
Chapter 4 Preparing Your Company for a Crowdfunded Offering p. 36
Choose the Right Legal Entity p. 36
Decide Where to Incorporate, or Consider Reincorporating Somewhere Else p. 44
What Type of Security- Witt Yon Be Offering? p. 48
Amend Your Articles of Incorporation to Create a Separate Class of Shares for Your Crowdfunded Offering p. 50
Set Your Offering Amount and Determine the Dilution for Existing Investors p. 53
Prepare a Term Sheet for the Offering p. 56
Get Your Management Team and Initial Investors On Board p. 57
Chapter 5 Launching Your Crowdfunded Offering p. 58
Finding the Help You Need p. 58
Preparing Your Disclosure Documents p. 60
Finding the Right Funding Portal for Your Offering p. 69
Setting the Offering Schedule and the Minimum/Maximum Amounts p. 73
Chapter 6 Managing and Marketing Your Crowdfunded Offering p. 75
Your Offering Announcement: Where It Should Go, Where It Can''t Go p. 75
Advertising and Promoting Your Offering on the Funding Portal p. 77
Advertising and Promoting Your Offering Elsewhere p. 77
Can the Funding Portal Help You Advertise Your Offering? p. 78
Updating or Changing Your Offering Documents Midoffering p. 78
What If You Made a Mistake in Your Offering Documents? p. 79
Closing Your Offering Early, or Quitting While You''re Ahead p. 81
Filing Progress Reports with the SEC: Form C-U p. 81
Chapter 7 After Your Successful Crowdfunded Offering Is Completed p. 83
Getting Your Money from the Funding Portal p. 83
Issuing Your Securities to Investors p. 84
Complying with State Blue-Sky Laws p. 86
Creating a Stock Transfer Ledger p. 86
Updating Your Capitalization Table p. 87
Filing Your Annual Reports and Holding Your Annual Shareholders Meeting p. 90
Making Sure Your Company Doesn''t Get Too Big p. 91
Part 3 Communication with Your Crowd
Chapter 8 Keeping Your Crowd Under Control p. 95
Coping with Your New Partners p. 95
Developing a Shareholder Communication Program p. 96
Dealing with Time Vampires, Mata Haris, and Know-It-Alls p. 98
When You Have to Change Your Business Plan p. 99
When It''s Time to Throw in the Towel p. 101
When the Revolution Has Begun p. 103
Chapter 9 Going Back for Seconds: Launching Multiple Crowdfunded Offerings p. 106
Can You Launch Other Offerings at the Same Time as Your Crowdfunded Offering? p. 106
The "Upstairs-Downstairs" Offering p. 108
Can You Launch Another Crowdfunded Offering Right After You Complete Your First One? p. 109
Some Things to Consider When Launching a Follow-Up Offering p. 109
Part 4 Considerations for Investing in a Crowdfunded Offering or Setting Up a Funding Portal
Chapter 10 Should you Invest in a Crowdfunded Offering? p. 113
Why Are You Investing in a Crowdfunded Company? p. 114
Can You Legally Invest in a Title III Crowdfunded Offering? p. 114
Are You an Accredited Investor? p. 115
What Is Your Tolerance for Risk? p. 116
Calculating Your Investment Limit Under Title III p. 117
Can You Lie About Being Legally Able to Invest? p. 118
Participating in a Crowdfunded Offering p. 119
Bringing in Other Investors p. 125
Selling Your Crowdfunded Securities p. 125
Getting Involved in Your Crowdfunded Company p. 126
When Can You Write Off Your Worthless Investment in a Crowdfunded Company on Your Taxes? p. 128
Chapter 11 Should You Set Up a Funding Portal? p. 130
It May Be Too Late for the Early Money p. 130
Picking a Crowdfunding Niche p. 131
Setting Up a Funding Portal p. 132
The Portal''s Obligations to Vet Issuers p. 133
The Portal''s Obligations to Investors p. 134
The Portal''s Obligations to the SEC p. 135
The Portal''s Obligations to Market and Grow Its Business p. 136
The Portal''s Obligations in Managing Offerings p. 137
The Portal''s Liability for Mistakes p. 138
How a Funding Portal Makes Money p. 139
Using Crowdfunding to Raise Money for a Funding Portal p. 139
Part 5 Background Essentials: Crowdfunding History, Law, and Regulations
Chapter 12 Federal Regulation of Private Offerings of Securities Prior to the JOBS Act p. 143
Early 1900s: The States Get the Ball Rolling with Blue-Sky Laws p. 143
1933: The Federal Government Wades into the Securities Markets p. 144
1964: The SEC Adopts Regulation A p. 146
1970: The SEC Adopts Rule 146 for Private Placements p. 147
1982: The SEC Adopts Regulation D, Adding More Exemptions p. 148
1996: The National Securities Markets Improvement Act p. 151
2012: The Jumpstart Our Business Startups Act p. 151
Chapter 13 The JOBS Act and Regulation Crowdfunding Rules p. 152
Title I The IPO On-Ramp p. 152
Title II Private Placements and New Rule 506(c) p. 153
Title III Crowdfunded Offerings of Securities p. 158
Title IV Expanded Availability of Regulation A p. 160
Title V Changes to Definition of "Public Company" in the Securities and Exchange Act of 1934 p. 161
Title VI Special Provisions for Banks and Bank Holding Companies p. 162
Afterword: What the Author Really Thinks of Crowdfunding p. 163
First, the Bad News p. 163
Now for the Good News p. 166
And for Some Even Better News p. 167
The Longer-Term Picture p. 169
Acknowledgments p. 171
Appendix 1 SEC Form C p. 173
Appendix 2 Optional Question-and-Answer Format Version of SEC Form C p. 178
Appendix 3 Amended and Restated Certificate of Incorporation Creating Classes of Voting and Nonvoting Common Stock and Convertible Preferred Stock [Delaware form] p. 195
Appendix 4 Provision of LLC Operating Agreement Creating Classes of Voting and Nonvoting Membership Interest, with Nonvoting Preferred Interests p. 217
Appendix 5 Some Rights of Shareholders Under State Corporation Laws p. 221
Appendix 6 Term Sheet for Crowdfunded Offering of Debt Securities p. 224
Appendix 7 Term Sheet for Crowdfunded Offering of Series B (Nonvoting) Preferred Shares in Corporation p. 226
Appendix 8 Term Sheet for Crowdfunded Offering of Class B (Nonvoting) Membership Interests in a Limited Liability Company p. 234
Appendix 9 Sample Risk-Factors Section of a Crowdfunded Offering Statement p. 236
Appendix 10 Sample Accredited Investor Questionnaire p. 244
Suggestions for Further Reading p. 253
Index p. 257
About the Author p. 265
