Federal securities law requires that securities issued by companies to their investors must be registered with the Securities and Exchange Commission (SEC) unless the offering qualifies for an exemption from registration. Registration is a complicated and expensive process, which may be prohibitive for smaller companies.
One exemption from registration is available if the company offers securities only to accredited investors in a private offering. Accredited Investors are defined by the SEC in a variety of ways, including (and we are paraphrasing) as having $200,000 of annual income per individual ($300,000 per couple) with the expectation of that continuing, or if one has a net worth of more than $1 million, excluding the value of the person's primary residence. A private transaction means that there can be no general advertising or publicity about the offering while the round is open.
CircleUp is a private, password-protected network for accredited investors in order to meet these guidelines. CircleUp.com is a website operated by CircleUp Network, Inc. All securities related activity is conducted through Fundme Securities LLC, a wholly owned subsidiary of CircleUp Network, Inc. Fundme Securities LLC is a registered Broker/Dealer and member FINRA/SIPC. For guidance on how the JOBS Act may impact CircleUp, please see below.
The federal government enacted the JOBS Act on April 5th, 2012, establishing a new legal framework for private share offerings. After a SEC rulemaking period, crowdfunding, as defined in that Act will be permitted for all Americans.
As it stands today, issuer-led offerings may be permitted through an exemption including Regulation D, Rule 506. The JOBS Act may open up exciting new possibilities for investors in the future, but presently accredited investors can participate in private offerings through existing exemptions.
CircleUp uses the same 128-bit encryption used by top national banks. Our computer systems are closely monitored by VeriSign and McAfee, for added protection.
We email you alerts during and after your investment, so you'll know what's going on during the process.
We take steps to verify your identity through a national security company before any investment is finalized