The bill, which had previously passed the House with bipartisan support and is supported by the White House, was amended on the floor of the Senate to change the provision legalizing crowdfunding, small equity investments into private companies by non-accredited investors.
The amendment, based on a bill co-sponsored by Senators Jeff Merkley (D-OR), Michael Bennett (D-CO), Mary Landrieu (D-LA), and Massachusetts’ own Scott Brown (R-MA), requires that crowdfunding investments go through an “intermediary” registered with the SEC, that would function as a so-called eBay of crowdfunding.
Because of the amendment, the bill now moves back to the House to consider the amended version.
For more on the debate in the Senate, see our liveblogging.
What Does the JOBS Act Do?
- Legalizes crowdfunding.
- Provides an IPO “on ramp” exempting smaller companies from certain disclosure requirements.
- Increases the number of stockholders a private company can have from 500 to 2,000.
- Expands startups’ communications (advertising and solicitation) with potential investors.
- Lets incubators and online platforms like AngelList post certain financial documents.
- Amends analyst conflict of interest law.
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