2021 Year-End Letter from CfPA’s Chairman

Working for the success of every fundraiser and their supporters, by providing education, resources and assistance to all stakeholders in the Crowdfunding community

Dear friends,

Thank you for another year far surpassing my hopes both personally and professionally. The CfPA continues to be highly-regarded here and abroad as a generous and vital organization expanding access to capital and opportunity for entrepreneurs, small businesses and investors. Our work in 2021 helped Crowdfunding reach new highs, extended our global voice, and expanded our capacity domestically. We saw over $500M raised using RegCF offerings where even non-accredited investors finally got a piece of the pie. We saw RegA+ offerings land over $2B. For these, and so many other reasons, it continues to be an honor to be a part of a leadership team on the cutting edge of Alternative Finance. CfPA’s reputation continues to be enhanced by the many professionals who freely contribute their time and expertise to advancing the association and the industry. There have been so many noteworthy moments and I look forward to seeing even more debut in ’22.

In 2021 I learned that a Chair’s best use is more about counseling, enabling and facilitating a board of volunteer directors. After 8 years of sometimes cloudy, frenetic, reactionary executive responsibility on the board as President/Chair, VP and Secretary, this year continued to reinforce that Restraint, Patience and Availability were most beneficial to the organization’s productivity. In a year we were all forced yet again to practice patience, discipline and resilience, the necessity of productive group discussion has only grown more valuable and at the same time more challenging as our members and our leadership faced similar disruptions in their paid professions. Luckily, our board again carried this responsibility diligently, as we added a great number goals and projects to our calendar, including the requisite planning sessions, expert discussions and public forums many of which were recorded to our growing video archive.

As we took account of our annual performance, we all agreed there remains plenty of room for improvement. As most boards only meet a few times per year, ours meets monthly, plus a monthly executive committee meeting, plus monthly committee meetings, plus numerous events, conferences and other gatherings. To accommodate this packed calendar, a number of improvements will begin in January, including a crop of new directors and more active committees. In addition, I will meet more frequently with all our board members individually to ensure their voices and priorities are incorporated into our evolving agenda. All of these changes should make our frequent meetings and demanding mission less prospective and more productive.

To that, our President, Samson Williams has provided me with a short list of what to expect from us in ’22. He asks for your continued support of the CfPA as members, as sponsors, as volunteers on our many projects, or even just as fans willing to share the news of how Crowdfunding has so rapidly become the go-to funding option for founders and business owners. Samson kindly thanks the funding portal operators, marketers, educators, investors and all champions of change, citing that together we make Main Street a healthier, more innovative marketplace for Startups and Entrepreneurs while making the funds they receive more transparent, accountable and meaningful to the investors trusting them.

On the slate for 2022:

  1. Crowdfunding Professional Certification — Crowdfunding will continue to be a multi-billion dollar industry (est. $8-$12B annually by 2026). Investors and entrepreneurs deserve to trust that certified credentials underpin the distinction of “Crowdfunding Professional”. We have several developments underway, all including education and exams, to facilitate that such certification is broadly recognized and valuable.
  2. Technical Seminars — We surveyed funding portals, investors and issuers, and THE single biggest challenge facing them all is finding impartial, accurate, trustworthy technical assistance to demystify the Crowdfunding process. Need to know the nuts and bolts of the JOBS Act and Crowdfunding? Stay tuned as we launch our monthly technical seminars.
  3. Your voice on The Hill, and at the table — From advocating to raise individual investor limits to providing paths for more non-accredited investors to qualify for equity investments to raising campaign limits from $1M to $5M, the CfPA will continue to advocate for the changes that make Crowdfunding easier and more equitable for Founders, Investors and Funding Portal Operators. Join us and let us know what pain points you need us to help fix on your behalf in DC and beyond.

Samson closed off with “Entrepreneurship is so hard I generally only recommend it to my enemies and dreamers. Keep dreaming. I believe in you.”

For their tireless energy, bottomless optimism and genuine commitment, I thank, sincerely, our President Samson Williams, our VP Devin Thorpe, our Treasurer Brian Belley and our Secretary Peter Rostovsky, and all our selfless volunteer leaders serving on both the board and on committees. Ultimately, I am responsible for helping everyone on the board be the best director they can be, and while I can hardly take credit for this year’s remarkable performance despite all odds, I continue to be humbled being entrusted to chair this remarkable organization—I feel similarly when friends complement my son’s warm disposition assuming I must be a great parent—he’s just a good kid…and I’m pretty lucky there too.

Thank you all for another fulfilling year supporting equitability and prosperity for all. Sincerest regards, and to a bountiful, restorative year ahead,

Scott E. McIntyre
CfPA Board of Director


Download a PDF version of the 2021 Chairman’s Address letter here

SEC Lifts Advertising Ban On Private Offerings

Washington, DC – The Securities and Exchange Commission today adopted rules that will allow businesses to use advertising to raise money through private offerings. The Commission action today carries out a mandate for such rules mandated last year by the Jumpstart Our Businesses Startups Act. The SEC also adopted so-called “bad actors” under the Dodd-Frank Act.

SEC, July 10, 2013.

SEC, July 10, 2013.

Under the JOBS Act, the SEC adopted in a close 3 to 2 vote amendments to eliminate the prohibition against general solicitation and general advertising in certain securities offerings conducted pursuant to Rule 506 of Regulation D under the Securities Act and Rule 144A under the Securities Act, as mandated by Section 201(a) of the Jumpstart Our Business Startups Act.

In August 2012, the SEC issued a proposed rule to amend Rule 506 (well as the similar Rule 144A of the Securities Act) and permit these general solicitations as long as issuers “take reasonable steps to verify” that all of the purchasers are accredited investors.

The Commission also adopted amendments to disqualify securities offerings involving certain “felons and other ‘bad actors’” from reliance on the exemption from Securities Act registration pursuant to Rule 506 as mandated by Section 926 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.  SEC Chair Mary Jo White urged the Commission to consider the two amendments in tandem to help implement the JOBS Act and safeguard investors.

SEC Viewpoints

SEC Chair Mary Jo White, who voted in favor of all provisions, urged the Commissioners to keep the JOBS Act mandate on track. “The Commissioners should act without delay,” she urged. In her vote in support of the general solicitation rules, Commissioner Elisse Walter pointed out “This will help issuers raise capital efficiently.”

Commissioner Luis Aguilar voted against the general solicitation proposals, criticizing the “reckless adoption” of the rules without providing adequate safeguards for investors.  Commissioners Dan Gallagher and Troy Paredes feared the general solicitation rules would thwart the purpose of the JOBS Act and place considerable burden on the equity market. “The proposals will do more harm than go,” said Commissioner Gallagher.


The SEC’s next step is to post the amendments on the Federal Register, which may take approximately two days, according to Sarah Hanks, CEO of CrowdCheck.com and former General Counsel of the Congressional Oversight Panel, the overseer of the Troubled Asset Relief Program (TARP). The SEC will note the effective date of each amendment on the Federal Registry, which could range from a minimum of 30 days to 90 days.

Keith Higgins, the SEC’s DIrector of Division of Corporate finance and other SEC staff members advised the Commissioners that they will develop a list of methods that private firms can use to ensure that offerings are only made to accredited investors, and internal procedures for the agency to evaluate verification practices.


FINRA Board Considers Proposals for Crowdfunding Portal Rules

The Financial Industry Regulatory Authority Board of Governors will consider a proposal on July 11, 2013 to solicit comment via Regulatory Notice on proposed rules and related forms governing crowdfunding portals pursuant to Title III of the JOBS Act. After the July 11 meeting, FINRA will notify firms via email about the Board’s actions on these items and anticipated next steps, if any.

David Weild Announced as Keynote Speaker for Leading Crowd Funding Industry Event

The Crowdfunding Professional Association (CfPA), the leading trade organization for the crowdfunding industry, will be holding its 2nd Annual Crowd Investing Innovation Forum on August 8-9, 2013 in Orlando, FL with former NASDAQ Vice Chairman David Weild IV as keynote speaker.

New York, NY (PRWEB) July 01, 2013

The Crowdfunding Professional Association (CfPA), the leading trade organization for the crowdfunding industry, is pleased to announce that David Weild IV, renowned capital markets expert and former Vice Chairman of NASDAQ, will be delivering the keynote address at the CfPA’s 2nd Annual Crowd Investing Innovation Forum on August 8-9, 2013 in Orlando, FL.

Referred to by many as the “The father of the JOBS Act,” Weild’s research at Grant Thornton and the OECD is frequently cited by the financial media as well as a broad range of legislators, regulators, academics, the IPO Task Force and the White House Jobs Council. His work linking the reduction in the number of small cap IPOs to rising unemployment and illustrating how structural changes to stock markets have caused systemic hardship for smaller issuers, their investors and the economy, was the inspiration for the movement that led to the JOBS Act.

“There is no one more appropriate than David Weild to address our growing audience of financial advisors and veteran investors who are attending this year’s conference specifically to learn how to capitalize in a shifting market environment rapidly being reshaped by crowdfinance methodologies,” said Luan Cox, Founder of Crowdnetic and Co-producer of this year’s event. “Our objective this year is to help traditional financial service providers increase profitability and efficiencies through the integration of regulatory changes and new market technologies.”

CfPA’s 2nd Annual Crowd Investing Innovation Forum will feature a powerful lineup of presentations, interactive panel discussions as well as an exhibit hall comprised of leading and emerging crowdfinancing portals. The discourse will spark change, challenge existing paradigms and debate conventional thinking as well as unleash new perspectives in the pursuit of real solutions. The event is sponsored Ellenoff Grossman & Schole,CrowdClearIRA InnovationsEarlyShares and CrowdCheck. For a complete list of presenters or to register for this event, please visit http://events.cfpa.org/.

About the Crowdfunding Professional Association
The Crowdfunding Professional Association (CfPA) is dedicated to facilitating a vibrant, credible and growing Crowdfunding community while advocating for an industry view versus a single company perspective. Uniting a broad-based coalition of industry participants, the association is committed to ensuring the credible development of the industry, including a commitment to the highest ethical standards. To learn more visit https://cfpa.org.

About the 2nd Annual Crowd Investing Forum
The Crowdfunding Professional Association’s 2nd Annual Crowd Investing Innovation Forum will convene top crowdfunding pioneers, policymakers, entrepreneurs and investors to address the most urgent issues in capital formation, job creation, public policy as well as corporate and entrepreneurial initiatives. Through unscripted interviews, frank and intimate discussion, the goal is to unleash new perspectives in the pursuit of real solutions. This important industry event will be held at the Caribe Royale Resort in Orlando, Florida on August 8-9, 2013.

The Crowdfunding Professional Association is the leading trade organization in the crowdfunding industry. With over 700 members from all over the world, membership in the CfPA provides an array of benefits for all kinds of industry participants. Here are a few reasons to consider joining the CfPA today:

Network with crowdfunding professionals and thought leaders

The CfPA has a robust membership comprised of thought leadership spanning every aspect of the crowdfunding industry. From crowdfunding platform representatives to service providers, investor advocates, public relations experts and members of the media, every slice of the industry is well represented. Joining the CfPA is a great first step to meeting the names and faces that are helping to build the next generation in capital formation.

The CfPA is always looking for volunteers to participate on the association’s subcommittees and help further initiatives benefitting the entire crowdfunding industry. If you have some time to spare, participating as a volunteer may present a great opportunity to get to know those in the space and to help them get to know yourself as well!

Every year the association sponsors a Crowdfund Investing Innovation Forum. This event brings entrepreneurs, investors and government representatives together to discuss how public policy interacts with capital formation and job creation. Becoming a member helps to establish networks ahead of this important industry event.

Be informed on the latest happenings in the crowdfunding space

If you find it hard to keep up with the fast pace of news in the crowdfunding space you aren’t alone! Joining the CfPA is a great way to stay in touch with other industry leaders and stay in the loop on the latest industry news. As crowdfunding stakeholders we pay close attention to happenings within the SEC and Congress and make sure our membership remains informed of important changes to policy and enforcement.

Give back to the industry

The crowdfunding industry as a whole benefits from a well-informed, engaged public. This belief is at the core of everything we do at the CfPA. By becoming an active member, you get a great opportunity to give back to the industry and the community and join a group of professionals who are working tirelessly to advance educational efforts around crowdfunding and crowdfund investing.

The initiatives we’re working on at the CfPA are driving the future of entrepreneurship and capital formation. We believe that by democratizing access to capital we can help create jobs and have lasting positive effects on economies around the globe. It’s nothing short of changing the world! To join us in this mission email info@crowdfundingprofessional.org for more information.

GOP Leaders Push SEC to Implement JOBS Act Rules

Sen. John Thune

Sen. John Thune

Washington, D.C. – May 13, 2013 – Senators John Thune (R-S.D.) and Pat Toomey (R-Pa.), and Representatives Kevin McCarthy (R-Calif.) and Patrick McHenry (R-N.C.) today sent a letter to the Chairman of the U.S. Securities and Exchange Commission (SEC), Mary Jo White, urging the SEC to move forward with the proposed rule to implement Section 201 of the bipartisan Jumpstart Our Business Startups (JOBS) Act.  President Obama signed the JOBS Act into law on April 5, 2012.  The JOBS Act originally called for rules by July 4, 2012.

Section 201 of the JOBS Act removes a SEC provision that currently prevents small businesses from attracting capital from accredited investors nationwide by allowing the use of general advertisements to solicit capital to accredited investors.  The letter reads as follows:

May 13, 2013 

The Honorable Mary Jo White, Chairman                                                           
U.S. Securities and Exchange Commission   
100 F Street, Northeast
Washington, D.C. 20549                                                  

Dear Chairman White:

As you settle into your new role as Chairman of the Securities and Exchange Commission (SEC), we write to urge the Commission to take prompt action in issuing a final rule to implement Section 201 of the Jumpstart Our Business Startups (JOBS) Act. As you know, it has been more than a year since Congress passed – with broad bipartisan support – and the president signed into law the JOBS Act. We were encouraged by the commitment that you demonstrated during your confirmation process to see that the Commission completes these important rulemakings and hope that you will take steps to do so expeditiously.

The overall purpose of the JOBS Act was to facilitate capital formation to help small businesses and entrepreneurs invest, expand and create jobs. As proponents of the JOBS Act, we believe that the rule proposed by the Commission last August accomplishes this goal. The proposed rule properly implements Congress’ intent to remove the general solicitation ban in a consistent manner for all types of issuers conducting private offerings under Rule 506.

Paragraph (b) of Section 201 clearly effectuates this by providing that all issuers subject to other federal securities laws will be able to conduct private offerings pursuant to amended Rule 506. The proposed rule ensures that all purchasers of securities under Rule 506 are accredited investors, and follows Congress’ policy objectives to require that issuers take reasonable steps to verify that the purchasers are accredited investors. Adding additional or more prescriptive requirements would overturn Congress’ intent and we strongly urge the Commission not to do so.

Again, we were encouraged by your demonstrated commitment to completing the JOBS Act rulemakings and respectfully urge the commission to move forward with the proposed rule and implement a final rule in the near future.


Senator John Thune
Senator Pat Toomey
Representative Kevin McCarthy
Representative Patrick McHenry

Study Says Crowdfunders Apply Similar Factors as VCs To Assess Entrepreneurs

A new study by Wharton Management Professor Ethan Mollick finds that crowdfunders apply similar factors as venture capitalists to decide whether to fund a start-up venture.  The study dispels some concerns that crowdfund investors lack any sophistication.

According to Professor Mollick’s recent paper, “Swept Away by the Crowd? Crowdfunding, Venture Capital and the Selection of Entrepreneurs,” a draft of which was published in March, entrepreneurial quality is being examined in similar ways by donors on Kickstarter and also by venture capital firms. “Despite the radical differences in selection environments, I find that entrepreneurial quality is assessed in similar ways by both VCs and crowdfunders, but that crowdfunding alleviates some of geographic and gender biases associated with the way that VCs look for signals of quality,” Prof. Mollick reported. ”They are looking for similar signs of quality.”

Prof. Mollick examined 2,101 crowdfunded projects on Kickstarter that match characteristics of more traditional VC-backed seed ventures, such as technology related projects. Prof. Mallick’s research team reviewed factors such as the history of success of a project, the influence of endorsements on a crowdfund project, the level of preparation demonstrated by an entrepreneur, quality, social networks, geographic outcomes and gender. Prof. Mollick discovered that crowdfunders act like venture capitalists or other tranditional sources of capital.  He found that crowdfund funders and venture capitalists focus on the following, similar factors:

  • The quality of the product.
  • The Team.
  • The likelihood of success.

Since some projects are better than others, they receive funding, according to Prof. Mollick, and lower-quality projects receive little to no backers. “{T]he finding suggest that the signals of quality that are used by VCs to assess the viability of new ventures are also used by crowdfunders,” he observed. “This bolsters the validity of these signals as indicators of start-up potential, but also suggests that crowdfunding has the ability to distinguish quality potential projects from less promising ones.”

President Obama signs JOBS Act into law on April 5, 2012.

President Obama signs JOBS Act into law on April 5, 2012.

Prof. Mollick also found that crowdfunding seems to avoid some of the biases that are, in his words, pervasive in VC selections. “Crowdfunding is more democratically distributed than VC funding,” he wrote. “The proportion of crowdfunded start-ups with female founders was larger by an order of magnitude than that of VC- backed firms.”

“In his 2012 remarks upon signing the JOBS Act to legalize equity crowdfunding, President Obama stated that ‘for start-ups and small businesses, this bill is a potential game changer,’” Prof. Mollick wrote in his conclusion. “Crowdfunding does represent a major shift — a ‘game changer’ — in the way that start-ups receive vital resources.”

Donald Trump Puts Money into Crowdfunding

New York, NY – May 8, 2013 – Donald Trump says he’s willing to put his money where his mouth is by investing in crowdfunding. Today, Mr. Trump and his partner William Zanker announced the launch of Fundanything.com, a crowdfunding portal intended to give people “a way to raise capital to pay for a medical emergency, save or rebuild their home, launch a business, create the next Farmville, write a book, or any other worthy project.” Over the past week, Google Ventures and other venture capitalists invested in crowdfunding portals such as CircleUp and Lending Club.

Mr. Trump said he plans to help crowdfund worthy projects on the Fundanything.com site. “I’m taking a stand, and am putting my money where my mouth is to help get people back on their feet,” said Mr. Trump during the event. “That’s where FundAnything comes in. It’s the first website that actually lets anyone, anywhere raise money for ANYTHING. And that’s why I support it.”

Screen shot courtesy FundAnything.com

Screen shot courtesy FundAnything.com

“I believe the private sector is the real engine for growth and success,” added Mr. Trump. “So, I’ve decided to give away money at the grass roots level….my money is and will be going directly into the hands of real people.” Mr. Trump is Chairman and President of Trump Organization.

Mr. Trump’s partner, Bill Zanker, is the founder of The Learning Annex, the iconic company that changed adult education in America. “I’m so excited about FundAnything,” said Mr. Zanker in a prepared statement. “Money is a huge worry for people. You only need a minute on the site to see this is a real game changer! Mr. Trump and I are going to help millions of people.”

This website reported earlier this week that major investors also have funded two other platforms, CircleUp and Lending Club, showing an emerging interest in crowdfunding as a viable funding platform for startups.



Big Investors Put their Faith — and Wallet — into Crowdfunding

Crowd photo by James Cridland

Crowd photo by James Cridland

New York – May 7, 2013 – Google Ventures as well as other high profile venture capitalists are showing their faith in crowdfunding’s future by fundingplatforms such as CircleUp and Lending Club. Today, CircleUp, an equity-based crowdfunding platform, announced today it has closed a $7.5 million Series A financing, the largest raise for an equity-based crowdfunding site. With the new funding, CircleUp plans to hire engineers and designers to build out the technology to serve more independent investors and small businesses. Last week, Google Ventures invested $125 Million into crowdfunding site Lending Club.

Union Square Ventures led the investment round in CircleUp. Google Ventures and existing seed round investors Rose Park Advisors, a firm led by disruptive technology innovator Clayton Christensen, Maveron, and financial services veteran David Topper, also participated in the Series A round. Andy Weissman, Managing Partner at Union Square Ventures will join CircleUp’s Board of Directors. In a statement posted on Union Venture Squares’ site, Mr. Weissman believes that the technology-enabled marketplace for funding has created an entirely new system of allocating capital and expertise. “This kind of peer-funding network has the potential to expand the types of investors and entrepreneurs that can participate in private investing,” said Mr. Weissman.

Mr. Weisman sees crowdfunding as a viable fundraising strategy for consumer products. “One of the most vibrant verticals is consumer products, with over 50,000 new consumer and retail companies started every year. These businesses are drivers of economic growth,” Mr. Weissman said. “CircleUp has created an equity crowdfunding marketplace, enabling investors to own pieces of small but fast-growing consumer and retail businesses.”

On May 2, 2013, Lending Club announced that Google ventures invested $125 Million into the crowdfunding personal loan site. ”Lending Club is using the Internet to reshape the financial system and profoundly transform the way people think of credit and investment,” said Google’s David Lawee. “We are excited to be a part of it.”  According to press reports,  investors are valuing Lending club at $1.55 Billion.

Article by A. Brian Dengler. Photograph by James Cridland under Creative Commons license.

SEC Chair: JOBS Act a Priority, but SEC Needs More Money

Washington, D.C. – May 7, 2013 – Mary Jo White made her first appearance on Capitol Hill today as the new chair of the Securities and Exchange Commission and urged members of a House panel  to approve a new budget that would enable the SEC to move swiftly on making rules under the JOBS Act and other laws.  Ms. White testified today before the Financial Services subcommittee of the House Committee on Appropriations seeking approval of a $1.674 Million budget.

SEC Chair Mary Jo White. Courtesy Securities and Exchange Commission

SEC Chair Mary Jo White. Courtesy Securities and Exchange Commission

In her testimony, Ms. White said rules under the JOBS Act and the Dodd-Frank Act are a priority. “First, the SEC must complete, swiftly and thoughtfully, the rulemaking mandates contained in the Dodd-Frank Act and JOBS Act, ” said Ms. White. “The JOBS Act requires significant Commission rulemaking which has not yet been completed.  To fulfill these legislative mandates expeditiously must be an immediate imperative for the commission.  In connection with those rules, I will continue the Commission’s efforts to ensure that the SEC performs robust economic analysis, as rigorous economic analysis is important and should inform and help guide our decisions.”

“As you know, the SEC has a broad, three-part mission: to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation,” Ms. White testified before the committee. A copy of her testimony can be reviewed here.

Ms. White said the budget request would enable the SEC to bring in more economists to perform economic and risk analyses to assist in all of our rulemaking decisions, as well as support new technology for a municipal advisor registration system. ”The FY 2014 budget request – all of which would be fully offset by matching collections of fees on securities transactions and thus will not increase the Federal budget deficit – seeks to address these challenges directly, to better position the agency to provide the kind of market oversight that the public expects and deserves.”

Article by A. Brian Dengler. Mr. Dengler is an information technology and digital media attorney and instructor at Kent State University.