By utilizing an exemption, a company can avoid the cost and time of registration. Depending on the exemption relied upon, a company may limitations with respect to dollar value of securities offered, number of investors, investor types, and advertising methods.
Pursuant to Rules 504, 505, and 506 of Regulation D of the Securities Act of 1933, companies, hedge funds, and other private funds are permitted to sell securities in an unregistered offering. Under Regulation D, Rules 504 and 506 are the most commonly used securities exemptions in capital raising activities in the U.S.
Rule 504 of Regulation D provides an exemption from registration under the Securities Act of 1933 for the offer and sale of up to $10,000,000 of securities in a 12-month period.
As a general overview, Rule 506(b) allows a company to raise an unlimited amount of money, from an unlimited number of accredited investors. An issuer relying on Rule 506(b) may also sell to up to 35 non-accredited, sophisticated investors, provided that certain additional disclosure requirements are met. In order to verify an investor’s accredited status, companies are permitted to rely on the investors' representations, often times via a questionnaire.
Similar to Rule 506(b), Rule 506(c) allows a company to raise an unlimited amount of money. However, an issuer may sell only to accredited investors. Companies relying on this exemption must take reasonable steps to verify accredited investor status of its investors. The major benefit of a Rule 506(c) offering is in the company's ability to generally solicit the offering to the public. As digital marketing is now mainstream, offering securities for sale, online, is now permissible under this framework.
While there are risks associated with raising capital under any exemption, our Firm understands and has experience handling these concerns. We help our clients through every stage of your financing plan including:
We have worked with Robin for almost a year now and it has been an incredible experience. Robin thinks outside the box, is very professional and extremely pleasant to work with. She is an expert in Regulation Crowdfunding and we are very satisfied with our choice to retain her. I would recommend Robin to any small start up. Robin is extremely qualified, reliable, and very cool!
Patricia Hertling, Co-Founder
Robin and her team were extremely knowledgeable about the evolving legal requirements around crowdfunding. The entire team was responsive and professional throughout our campaign. The team answers questions in a thorough and efficient manner which made it a cost-effective relationship for our small business.
Carlos Ventura, CEO
FEAST & FETTLE
Robin has the insight and compassion that is needed for any startup working to raise capital or manage the legal aspects of their business. She is not just an attorney but also a business women who will elegantly guide owners or decision makers to make the best possible legal decisions. She will actively understand your business, pursue various options and connect with outside resources in-order to help her client fully understand all their legal option. She is passionately focused on making sure her clients make the best possible decisions that will positively impact their business for both the short & long term.
Sandra Gault, Founder and CEO
We had the pleasure of working with Robin and her team to conduct our legal review for our crowdfunding campaign with Indiegogo and MicroVentures. We had been through the Reg D process before, but Reg CF was entirely new to us. Robin and her team were great in explaining the process and meeting our rushed deadlines to get everything ready. I highly recommend that anyone considering an equity crowdfunding campaign use Robin as their legal team.
Sunny Washington, CEO
The process of raising capital for any startup or early stage company is fraught with complexity, challenges and details that are often largely outside of the regular day-to-day activities of the organization. In addition to this reality, the process can be demoralizing, time consuming and very expensive. In contrast, our experience with the Reg CF process, while requiring real work and preparation, has been cost effective and efficient. A huge part of that was the feedback and guidance of Robin Sosnow, Esq and her staff. Robin's legal review was detail-oriented and thorough while still fast. The back-and-forth surrounding our questions and the final review process seamless as well. I would not hesitate to recommend or hire Robin in the future.
Brendan Burns, CEO
STEPSTONE ARTS RESOURCES
Equity Crowdfunding is an exciting new frontier for entrepreneurs, but can be confusing and frustrating to navigate, even with an experienced partner. Robin and her team are experts in the space, and were critical partners for us in our journey. They were responsive when we needed them and thorough in their feedback, ensuring to the last detail that no mistakes no mistakes were made. If you’re thinking of embarking on an equity crowdfunding campaign, reach out to Robin sooner rather than later!
Jordan Schwartz, COO & Co-Founder
We worked with Robin and her team for our equity crowdfunding raise on Microventures.com. As a first-time crowdfunder, she helped me navigate the process and made sure all of my concerns were addressed. Robin went above and beyond my expectations -- especially when she hired our company and helped us promote our crowdfunding campaign to her audience! The best JOBS Act firm in the biz!
Nicholas China, CEO
Robin Sosnow was our attorney on our crowdfunding that we did with IndieGoGo/Microventures. We were under the gun to get things going quickly and I put the pressure on. Robin and her team were terrific. They explained an area that was new to me and got all the paperwork done in record time. I'd highly recommend them for this kind of work, they are the experts.
Michael Hoffman, CEO
We had the opportunity to work with Robin Sosnow, PLCC during our recent crowdfunding venture. Robin was very professional and explained the process in detail. Any time we had any questions Robin was available and prompt on her responses. Going through a crowdfunding process is very time consuming and requires a lot of documentation. With all the efforts that Robin put in place it made our job easier to obtain all the documentation and complete the process in a timely manner.
Christinia Marc, Administrative Manager
My company and I worked with Robin and her team on a rather complex equity crowdfunding launch. Robin clearly knows the JOBS act inside and out - and she and her team always went the extra mile to make sure everything was buttoned-up properly. She's an excellent attorney and I'll definitely be working with her again.
Paul Siedarski, CEO and Head of Product
Sosnow & Associates has been integral to us launching our crowdfunding platform, not just with their expertise but with meeting quick turnarounds for prompt regulatory responses. Couldn’t do it without you. Thank you!
Luiggi Pera, Miventure Cofounder & CRO
Robin Sosnow and Manuel Pesendorfer are 100% plugged into the new SEC rules for Regulation Crowdfunding and continue to advise our funding portal to maintain compliance and support our business. They are super-connected to top influencers in the equity crowdfunding ecosystem and always ready to make introductions. We highly recommend Sosnow & Associates, and they are also nice people to work with.
Bruce Virga, CEO