The US Securities and Exchange Commission voted to remove an 80 year ban on General Solicitation for company investment today. This is going to dramatically change the startup and venture capital fundraising landscape because the ban has prevented companies from publicly disclosing any efforts to seek fundraising. Companies seeking funding are also no longer forced to talk to investors individually.
So far, here are the pros and cons people are seeing in this change:
- No need to be well-connected in order for certain investors to find your company
- Easier to find investors and vice versa
- Companies can communicate with more investors with much more efficiency
- More companies visibly seeking investment means a lot more noise for investors to sort through; some companies still won't be found
What are your thoughts about the news?