Tell the Senate to Legalize Crowdfunded Securities with a Full-page Ad in Politico
The OpportunityShould non-millionaires be able to invest small amounts in local businesses or other ventures that they believe in, without the ventures having to spend tens of thousands (or more) on state or federal securities compliance? We believe so, provided that the offerings can be seen and discussed openly, and have other requirements and limitations to prevent fraud. Without costing anything, such a regulatory change would create meaningful jobs, spur innovation, and fuel the economy.
But this is currently illegal thanks to securities laws written in the 1930s, when ordinary people had no way to check the claims of fraudsters armed with smooth telephone voices and fancy printed letterhead with New York City addresses.
Bipartisan efforts to modernize these laws and introduce a “crowdfunding exemption” have been progressing rapidly over the past year. H.R.2930, the Entrepreneur Access to Capital Act, overwhelmingly passed the House (407-17) last November, with White House support. Now it and two other crowdfunding bills (S.1791 and S.1970) are stalled in the Senate. Sources there say that the Senate needs to see that public interest in these proposals exists, before they will venture to consider them.
To demonstrate public interest (as well as the power of crowdfunding), we are launching a campaign to take out a full page ad in the Washington D.C. newspaper Politico, which is distributed in printed form to Congressional staffers and other DC types.
The House has already spoken, and the White House has told us that they are ready to sign – we now just have to push some demonstrable public interest in the Senate’s face.
A full-page ad in their favorite newspapers, crowdfunded by large numbers of supporters, is something that they will not be able to ignore.
The Ad PlacementLaunched in 2007, Politico is a newcomer to the inside-DC newspaper scene, but it has surpassed its rivals (CQ Weekly, The Hill, National Journal, and Roll Call) in influence over "opinion leaders," according to a recent survey by Erdos and Morgan. The back page is the most prominent advertising space in the tabloid-style newspaper, so that's our target.
The cost of a one-time black-and-white full-page ad is $11,202.15. We'll do a black-and-white ad because it's cheaper than color.
If we surpass our goal, we can consider advertising in a more expensive national media outlet that has a broader reach and even more influence (like the Washington Post), or else run the ad in Politico over and over again, hammering it into the the Senate's consciousness that there's a groundswell of support for a well-designed crowdfunding exemption.
Below is a near-final version of the ad we envision. It will point people to LegalizeCrowdfunding.org, a new website by Woodie Neiss and the Startup Exemption folks that vividly demonstrates the potential of a crowdfunding exemption by letting entrepreneurs register themselves and show in a mouse-over map of the USA how many jobs they could create.
This ad was written by Michael Shuman, author of The Small-Mart Revolution and Going Local with contributions from Paul Spinrad, the American Sustainable Business Council, and Jake Levitas. It was designed by Jake Levitas, who created posters and other graphics for Occupy Wall Street.
Total cost: $13,530
Breakdown: $11,202 for the ad itself, $500 for design of the ad, 10% for LoudSauce's fee, and 3.5% for the WePay fees (50 cents minimum per transaction, so this percentage will actually be higher for any donations under $14.29).
So that's ((11,202 + 500) / (100 - (10 + 3.5)) = $13.530
What is Crowdfunding?This great video from Rep. Patrick McHenry, sponsor of H.R.2930, describes crowdfunding and what a crowdfunding exemption could do for local investment: