1. The JOBS Act

Signed into law on April 5, 2012, the Jumpstart Our Business Startups (JOBS) Act remains a revolutionary development in the world of startup and small business financing. The revolutionary potential of the JOBS Act has been gradually activated by phased regulatory implementation of its various parts, called titles. Only since May 16, 2016, for example, have startups and small businesses been enabled to tap the promise of certain provisions in the JOBS Act to use the power of the Internet to raise equity capital from investors across the country and around the globe. These provisions allow small companies, including startups, to raise via crowdfunding (described in full later in this chapter) up to $1 million per year, subject to a five-year and $700 million market-value limit. For such companies, the JOBS Act has also created exemptions to accounting and auditing rules, as well as to rules that require public companies to report details concerning executive compensation and other financial data.