Regulation A (Reg A+) has been around a long time, but it wasn’t until the JOBS Act of 2012 and SEC rule-making modified it to a modern usable funding mechanism..hence the “+”. Reg A+ is really so much more than simply a crowdfunding mechanism.  Besides being powerful due to the ability to use advertising, general solicitation, and access your customers, it is incredibly flexible and is now a mechanism a company can use over its entire life-cycle since the SEC allowed public companies to also utilize it.

Reg A+ can be used in to raise up to $50M per year from both accredited and unaccredited investors. Using Reg A+ you can take one of these routes:

Remain private – This is the mostly widely used option for a Reg A+ company with the lowest amount of continuing regulation and effort.   In this route, you file publicly and provide annual and semi-annual financial statements and updates in accordance with SEC requirements, but for all intensive purposes the entity remains private and not subject to the 1934 Exchange Act. There is no ticker symbol and no trading stock on an exchange.  

Remain Private with a Public Ticker – In this route, you can still remain private as before, but get a ticker symbol and trade on the OTC.  The OTC Markets have provided a path for Reg A+ issuers to both remain private and have a ticket symbol allowing the stock to trade like a micro-cap public company.  This can solve the issue of a private company having no liquidity in it’s stock.

Go Public – Going public with Reg A+ is can be slightly less burden than a traditional S-1 filing, while also allowing the Company to access a wider range of investors.  Through this method, a Company can go through a Reg A+ filing, and come out with a ticker symbol that trades on a national exchange (i.e. NASDAQ or NYSE).  However, these national exchanges have strict requirements for Reg A+ companies to list with them.

With any of these routes, there is a requirement for continued financial reporting. This is at least semi-annual and if public, quarterly. This is where BizCFO excels; by utilizing an cloud accounting package with extensive SEC reporting experience to keep filings coming timely and accurately.