Equity Crowdfunding is the general term used to describe the various methods of securities based crowdfunding which was part of the JOBS Act of 2012.  Equity Crowdfunding is made up of three mechanisms, Regulation A, better known as Regulation A+, Reg A+, or a Mini-IPO, Regulation Crowdfunding (Reg CF), and 506(c) Regulation D. Both Reg A+ and Reg CF issuers can raise from accredited or non-accredited investors with Reg CF being the more widely used.

Reg CF provides for the raising of up to $5M annually through a less regulated process. Companies undergoing a Reg CF offering have to choose a funding portal or Broker-dealer to work with, complete an offering page, and most importantly, a Form C filing with the SEC. As part of the Form C, an issuer is required to provide up to two years of GAAP based financial statements. If funds are successfully raised there is an annual reporting requirement thereafter.

In recent findings by the SEC, they found that over 50% of all Reg CF issuers could not maintain their financial disclosure filings after a successful raise. Meaning that the industry is clearly undeserved from an accounting perspective. This is primarily because of lack of funds, unclear rules, and the fact that most small businesses that use Reg CF do not have the proper accounting help (your tax guys down the street generally does not specialize in financial reporting).

BizCFO helps Reg CF issuers by dialing in you back-end accounting office structure, keeping the accounting up to date, assisting with technical accounting issues and drafting financial statements for annual filings.