Small business financing is one of the greatest hurdles any entrepreneur must face.
In 2015, we discussed a number of ways that entrepreneurs can raise the capital needed to get their companies off the ground and help them grow. We also highlighted several new laws, such as the Securities and Exchange Commission’s new equity crowdfunding rules, that is intended to benefit small business financing. In case you missed any of the posts, below is a brief recap:
SEC Crowdfunding Rules On October 30, 2015, the Securities and Exchange Commission (SEC) adopted final rules to implement equity crowdfunding under Title III of the Jumpstart Our Business Startups Act (JOBS Act). The much-anticipated rules are expected to be a game changer for startups and small businesses because it will allow them to raise money through smaller investments from a large number of people.
State-level crowdfunding While awaiting the SEC rules, more than 20 states legalized some form of equity crowdfunding at the local level. Most regulations allow entrepreneurs to solicit financing from investors who reside in the same state, subject to certain caps. Now that it has finalized its crowdfunding regulations, the SEC also proposed new rules intended to help facilitate intrastate and regional securities offerings.
Friends and Family When founders tap their own resources, friends and family can be a welcome source of capital for new ventures having difficulty securing loans or venture capital funds. Startups can often raise $50,000 to $500,000 and more through this type of financing. However, friends and family financing is not without its pitfalls, including the failure to formalize the arrangement.
Online Lending Online lending is set to outpace more traditional financing methods. In 2015, 80 percent of small-business owners went online first to search for a loan, according to the latest statistics. While the Internet can help connect companies with lenders, as with more traditional loans, it is still imperative for small businesses to do their research.
Regulation A+ Regulation A+, which took effect on June 29, 2015, is intended to provide small businesses with greater access to capital by expanding a little used exemption to SEC registration. Under the new regulations, businesses will be able to offer and sell up to $50 million of securities in a 12-month period, so long as they meet certain eligibility, disclosure and reporting requirements.
Special purpose acquisition companies (better known as SPACs) appear to be making a comeback. SPAC offerings for 2025 have already nearly surpassed last year’s totals, with additional transactions in the pipeline. SPACs last experienced a boom between 2020–2021, with approximately 600 U.S. companies raising a record $163 billion in 2021. Notable companies that went public […]
Short Form Merger: Streamlining the Process for Businesses
Merging two companies is a complex legal and business transaction. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process that involves important corporate governance considerations. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process. However, […]
Tariff Response Options for Small Businesses Facing Financial Distress
The Trump Administration’s new tariffs are having an oversized impact on small businesses, which already tend to operate on razor thin margins. Many businesses have been forced to raise prices, find new suppliers, lay off staff, and delay growth plans. For businesses facing even more dire financial circumstances, there are additional tariff response options, including […]
Common Causes of Partnership Disputes and How to Resolve Them
Business partnerships, much like marriages, function exceptionally well when partners are aligned but can become challenging when disagreements arise. Partnership disputes often stem from conflicts over business strategy, financial management, and unclear role definitions among partners. Understanding Business Partnership Conflicts Partnership conflicts place significant stress on businesses, making proactive measures essential. Partnerships should establish detailed […]
Businesses Are Facing Financial Headwinds—A Practical Guide
*** The original article was featured on Bloomberg Tax, April 28, 2025 — As a tax attorney who spends much of my time helping people and companies who have large, unresolved issues with the IRS or one or more state tax departments, it often occurs to me that the best service that I can provide […]
President Trump's Termination of Member Gwynne Wilcox
On January 28, 2025, the Trump Administration terminated Gwynne Wilcox from her position as a Member of the National Labor Relations Board (NLRB or the Board). Gwynne Wilcox, a union side lawyer for Levy Ratner, was confirmed to the Board for an original term in 2021 and confirmed again for a successive five-year term expiring […]
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