Well, after the SEC’s much anticipated Annual Government-Business Forum on Small Business Capital Formation yesterday, I’d hoped to post something of value regarding the state of the SEC’s effort to write the rules necessary for Title II and Title III crowdfunding. After all, there was a fair amount of build-up that this event would be THE forum for an SEC update as to timing and substance of pending regulations and the title of the opening session was “JOBS Act Implementation.” The update on implementation is: no update. After spending most of yesterday listening by webcast and teleconference and exactly one week in advance of Thanksgiving, I am most thankful that I did not waste money on a flight to Washington. Standing ready to take notes on the most important information, my computer screen was essentially blank at the end of the day. Being much more diligent than I (and undoubtedly a better typist), Bill Carleton has an excellent live blog summary here. My summary of the SEC position is rather simple: There are lots of issues. We are working on those issues. We do not know when we will get through the issues. We will get back to you. Stay Tuned.
Today there is absolutely nothing I can report that is of value to those who are wondering when any form of investment crowdfunding will be implemented under the JOBS Act. Further, there is nothing I can report as to whether it is likely that any form of investment crowdfunding will be worth conducting, either for issuers or portals, after those rules are written. No such luck. There were plenty of questions raised (as with any public event, they ranged from good to asinine). I do appreciate the time of the moderators who attempted to field questions, tried to fight through people on the phone who did not know how to operate their mute buttons and tried to provide something of value to those who were attending or listening.
Don’t get me wrong, I want the SEC to take time if they need time to get it right. Brian Knight at Crowdcheck makes that point well here. I, however, got more of a sense yesterday that the SEC is simply over thinking the issues and that the general regulatory instinct to build a fortress in advance of any sign of a conflict is carrying the day. Just a hunch–but it seems increasingly likely. The reality is that we don’t have to be overwhelmed by the potential issues of investment crowdfunding. As Jonny Sandlund has said before, the world has plenty of data showing the boogey men just don’t exist in investment crowdfunding. Never-the-less, we Americans always think we invented everything and that nothing has been decided until we decide. Perhaps the only good news is that the SEC is aware that their delay benefits those that are doing general solicitations in the US already. According to Meredith Cross, if you are jumping the gun “You may hear from us, and you may already have heard from us.” At least maybe those who are willing to play outside the rules during this period of delay will be held to account. Stay Tuned.