506 Docs® claims that Reg D is a hidden secret in the world of small business finance. In doing our research for this article we learned that their claims are indeed valid. We had a very hard time getting real information from anyone in the industry, that is, information beyond what is available in online articles. Sure, they gave us bits and pieces of the general rules, but then quickly moved into charging a fee for detailed analysis.
In our research we found that over $1T was raised using Regulation D in 2010, 2011, 2012 and 2013, with a hefty uptrend after the passing of The Jobs Act in 2012. Followed by another uptrend in 2013, after the SEC finally got around to releasing formal rules surrounding Regulation D Rule 506(c).
Before The Jobs Act business owners could not solicit investors in any way, without risking nasty lawsuits and/or criminal actions. As 506 Docs® explains in their blogs, after October 2013, small business owners can now seek out investors and place an advertisement about their need for private investors. The Jobs Act dictated that the SEC create rules that allow for general advertising to certain qualified investors, known as Accredited Investors.
What is important to note about The Jobs Act, besides the obvious Crowdfunding inclusion, is that it seems to have opened up a window of opportunity for the onslaught of Crowdfunding companies, who are now charging business owners a monthly fee for Regulation D Advertising.
We found 506 Docs® everywhere, Google, Yahoo, Bing, Linkedin, Facebook, Twitter, you name it. We do indeed recommend taking some time to read the highly informative blogs at 506 Docs® and then checking out their IndieGoGo Crowdfunding Campaign.
The website provides tutorials, blogs, faq's and template forms. Private Placement Memorandum Templates (PPM Templates) and everything else a small business owner needs to conduct a small capital raise using Regulation D Rule 506(b) and 506(c).