Regulation A+ (Reg A+ IPO) is an alternative to a traditional IPO, which makes it easier for existing public reporting companies and smaller, early stage companies to access growth capital.
Looking to encourage small-business growth, in 2012 Congress passed the Jumpstart Our Business (JOBS) Act, a law intended to support small- business growth and employment by lowering regulatory hurdles for companies trying to go public and allowing firms to have more private shareholders.
In 2015, Title IV of the JOBS Act went into effect, allowing companies to raise money and offer shares to the general public and not just accredited investors.
On May 24, 2018, President Trump signed the Economic Growth, Regulatory Relief and Consumer Protection ACT. Section 508, “ImprovingAccess to Capital” which now allows reporting public companies to raise up to $50MM from the general public under Regulation A+.
Through Reg A+, a U.S. or Canadian company is afforded the opportunity to:
- Raise up to $50 million in a 12-month period using a “public solicitation” of its shares and have the offering be exempt from SEC and state securities law registration.
- Confidentially submit its offering memorandum to the SEC and enjoy the opportunity to “test the waters” before pursuing a Reg A+ Offering.
- Enjoy a streamlined, expedited review process where the company is required to make its offering memorandum public just 21 days before SEC qualification and the beginning of its roadshow.
- Combine public funding (through Reg A+) with private funds from venture capitalists to create a larger round of fundraising.