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Why Women Should Care About the JOBS Act


On April 5, 2012, President Obama signed into law the Jumpstart Our Business Startups Act (JOBS Act), which, among other things, opens two new significant access points to capital for small business owners. In this Jam Session, learn about the JOBS Act and how you can take advantage of it.

Fri, Jun 22, 2012 1:00 PM - 2:00 PM EDT

Crowdfunding – What’s in it for me? And when can I take advantage of it?

On April 5, 2012, President Obama signed into law the Jumpstart Our Business Startups Act (JOBS Act), which, among other things, opens two new significant access points to capital for small business owners.

As soon as July 5, 2012, any business owner in the United States will now be permitted to “solicit” investors in any method or manner they choose, so long as the ultimate investor in their business is “accredited”. To qualify as an accredited investor, an investor must either be: A) a financial institution; B) an affiliate of the issuer; or C) an individual with a net worth of at least $1 million or an annual income of at least $200,000 for two consecutive years, and the investment must not account for more than 20% of the investor’s worth. This removal of the decades-old general solicitation ban is significant in impact, but only affects a percentage of wage-earners.

Second, however, a new “Crowdfunding Exemption” will take effect as early as January, 2013, which will allow small business owners to solicit up to $1 million from individuals, irrespective of income level, for investment in their company, but must do so through the use of a crowdfunding “portal”. Individuals earning less than $100,000 per year are able to invest up to 5% of their net assets, and individuals earning more than $100,000 per year may invest up to 10% of their total net assets.

For the first time in American history, small businesses will have access to 90% of Americans in a way never permitted before. And now, any American wishing to diversify their investment portfolio can choose to do so by investing directly in the small businesses they know and love.

As women of influence in our communities, the passage of the JOBS Act has a significant impact on the members of 85 Broads. In 2011, only 12% of angel investors were women. Many studies have opined that the reason for this is two-fold: 1) women are not as high wage-earners as their male counterparts, and are therefore unable to meet “accredited investor” requirements; and 2) women are more cautious in their investment decisions, and invest in more conservative methods than men.

As the JOBS Act requires complete transparency from the small business raising capital, and as the requirement for accreditation has been removed to begin making investment, women will now be able to participate, both as issuers and investors, in making small business investments. As a result, a study conducted by Xavier University American Dream Composite Index revealed that among the most likely investors in this new crowdfunding industry are women.

Sound interesting? I agree! But I urge you to proceed with some caution. Since the JOBS Act is a significant departure from existing securities regulation, the SEC has been granted a 90-day and 270-day rule making period to set the regulatory framework for this new industry. As such, you are not permitted to do anything until July 5th at the earliest. Once the SEC has spoken on the Regulation D solicitation, accredited (and only accredited) investors will be permitted to respond to general solicitations. The rest of us must wait until 2013 to take advantage of the new investment opportunity.

But it does behoove us to know about the legislation and regulatory discussion, to participate when and where we can in shaping this new industry, and to educate ourselves on how to best take advantage of the legislation.

About the Presenter:

Candace Klein, a securities attorney, is Founder and CEO of SoMoLend, a debt-based crowdfunding platform that launched in late 2011, and Chair of the CrowdFund Intermediary Regulatory Advocates, a group of industry leaders that meets weekly with the SEC, FINRA and members of Congress and the White House. Learn more about her work at and

Each session is limited to 200 Participants. Jam Sessions are FREE for all Student, Visionary, Investor, and Power Circle members of 85 Broads. Questions about your membership? Contact

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