WR Hambrecht + Co is making sure everyday investors can take part in Reg A+ Mini IPOs

June 09, 2016

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

Whitney-White-Equities-Quote-980x588

San Francisco, June 9, 2016 – Whitney White, head of capital markets, gives his view on current investment opportunities for Reg A+ mini-IPOs in an interview with Equities.com. Whit shares his perspective from the time he joined WR Hambrecht + Co to help build the OpenIPO platform. In this interview Whitney gives a good overview of the firm’s history built on the founder, Bill Hambrecht’s, vision of building a transparent, technology-driven process that would level the playing field and enable all classes of investors to participate in IPOs, to be part of the pricing. Attached is the link to the article that serves as a firm update and an update on how WR Hambrecht + Co has evolved to lead the IPO A+ mini-IPO market for investors and issuers.

 

ShiftPixy Files Regulation A+ Mini-IPO

May 31, 2016

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

ShiftPixy Files Regulation A+ Mini-IPO

ShiftPixy Files for Reg A+ Mini-IPO with Plans to List on NASDAQ — WR Hambrecht + Co will act as sole underwriter

San Francisco, CA, May 31, 2016 – For immediate release: WR Hambrecht + Co announces that on May 31, 2016, ShiftPixy publicly filed a Form 1-A Offering of common stock under SEC Regulation A. The offering will be conducted on a best-efforts basis by WR Hambrecht + Co as the sole underwriter. The company plans to list its common stock on The NASDAQ Capital Market under the symbol “PIXY” following the offering.

ShiftPixy is a temporary staffing service provider that contracts with clients with large contingent part-time workforce demands, primarily in the restaurant and hospitality industry, to become the employer and provider of workers to these clients primarily for part-time shift work. ShiftPixy addresses significant temporary staffing management and compliance challenges and significant financial risks of non-compliance presented by Affordable Care Act (ACA) to its target market of middle-tier (100-500) employees) restaurant and hospitality business.

ShiftPixy currently services approximately 155 clients and approximately 3,354 worksite employees. For more information on the ShiftPixy Regulation A+ IPO, visit their Regulation A+ IPO summary page.

“Our team is passionate about growth companies such as ShiftPixy because they represent a great opportunity for all classes of investors,” said John Hullar, Managing Partner, WR Hambrecht + Co. “We are pleased to bring Reg A+ Mini-IPOs to investors through an efficient and transparent web-enabled platform.”

Regulation A+ Creates New Options for Investors

Reg A+ was intended to help revive the small cap market by allowing early stage growth companies to raise up to $50 million in a public offering through a process that provides streamlined and lower-cost access to the capital markets for the issuer and gives the investor the opportunity to participate in the IPO for these potentially high growth companies. Other advantages include a more open selling process with the opportunity to “Test the Waters,” and the transparency of pre-IPO research available to all investors. Seeking a broad audience of investors, Reg A+ Mini-IPOs may include novel selling practices such as the use of crowd funding, and other internet-enabled methods. Because the securities offered under Reg A+ are freely tradable, Over-the- Counter ATSes (such as OTCQX, provided by OTC Markets Group) and national exchanges like NYSE and NASDAQ will be used to provide secondary market liquidity.

WRH+Co has Developed a Web-Enabled Platform for Investors

WRH+Co has developed a hybrid, web-enabled platform for public transactions that gives interested investors access to the offering circular and marketing materials, as well as the ability to register their interest level and ultimately even invest directly online if they choose. Please see www.wrhambrecht.com for access to the offering circulars and marketing materials for all current offerings.

About ShiftPixy

ShiftPixy is a temporary staffing service provider that contracts with clients with large contingent part-time workforce demands, primarily in the restaurant and hospitality business to become the employer and provider of workers to these clients primarily for part-time shift work. ShiftPixy addresses significant temporary staffing management and compliance challenges and significant financial risks of non-compliance presented by Affordable Care Act (ACA) to its target market of middle-tier (100-500 employees) restaurant and hospitality business. ShiftPixy currently operates in Los Angeles/Southern California, but plans to open additional physical offices in San Francisco, New York, Chicago, Dallas, Orlando, Atlanta, Philadelphia and Las Vegas upon completion of its offering, assuming the maximum offering being raised. These markets collectively account for, or allow ShiftPixy to cover 53% of the employers with 50 or more employees in this sector. (Statistics of US Businesses Employment and Payroll 2012; US Census Bureau). ShiftPixy currently services approximately 155 clients and approximately 3,354 worksite employees.

About WR Hambrecht + Co

WR Hambrecht + Co focuses on raising growth capital for a variety of different enterprises. Like its predecessor firm, Hambrecht & Quist, WRH+Co seeks to identify high prospects growth-stage companies, and then enable access to the capital necessary to fund development, marketing and infrastructure so that these companies can achieve their full potential. WRH+Co’s Regulation A+ Mini-IPO strategy is a continuation of Bill Hambrecht’s legacy of conducting small public offerings for what were once considered high-risk start-ups that are now household names and Fortune 500 companies.

Legal Disclaimer

The offering is being made only by means of an offering circular. An offering statement on Form 1-A relating to these securities has been filed with the Securities and Exchange Commission but has not yet become qualified. You may obtain a copy of the most recent version of the preliminary offering circular with the following link:

https://www.sec.gov/Archives/edgar/data/1675634/000147793216010647/shiftpixy_1a.htm

These securities may not be sold nor may offers to buy be accepted prior to the time the offering statement is qualified. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

No money or other consideration is being solicited in connection this press release, and if sent in response, will not be accepted. No offer to buy the securities can be accepted and no part of the purchase price can be received until the offering statement on Form 1-A is qualified pursuant to Regulation A of the Securities Act of 1933, as amended, and any such offer may be withdrawn or revoked, without obligation or commitment of any kind, at any time before notice of its acceptance given after the qualification date. Any person’s indication of interest involves no obligation or commitment of any kind.

WRH+Co will lead Reg A+ Teach-in for Investors at Sidoti Conference 2016

March 29, 2016

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

 

Sidoti Emerging Growth Conference 2016

WRH + Co Teach-in – Regulation A+ Creates New Options for Investors.

Principals of WRH+Co will lead a teach-in for the Investor on Reg A+ at the Sidoti Emerging Growth Conference highlighting the new opportunities to invest in potentially high-growth companies through the new A+ IPO. John Hullar, Managing Partner, Whitney White, Head of Capital Markets, and Kurt Kruger, Head of the Life Science Practice, will lead WRH+Co’s Q&A Session at the Sidoti Emerging Growth Conference at 4:00pm on Thursday, March 31, 2016.

Regulation A+ Creates New Options for Investors

Reg A+ was intended to help revive the small cap market by allowing early stage growth companies to raise up to $50 million in a public offering through a process that provides streamlined and lower-cost access to the capital markets for the issuer and gives the investor the opportunity to participate in the IPO for these potentially high growth companies. Other advantages include a more open selling process with the opportunity to “Test the Waters,” and the transparency of pre-IPO research available to all investors. Seeking a broad audience of investors, Reg A+ offerings may include novel selling practices such as the use of crowd funding, and other internet-enabled methods. Because the securities offered under Reg A+ are freely tradable, Over-the-Counter ATSes (such as OTCQX, provided by OTC Markets Group) and national exchanges like NYSE and NASDAQ will be used to provide secondary market liquidity.

WRH+Co has Developed a Web-Enabled Platform for Investors

WRH+Co has developed a hybrid, web-enabled platform for public transactions that gives interested investors access to the offering circular and marketing materials, as well as the ability to register their interest level and ultimately even invest directly online if they choose. Please see www.wrhambrecht.com for access to the offering circulars and marketing materials for all current offerings.

About WR Hambrecht + Co
WR Hambrecht + Co was founded in 1998 to level the playing field for investors and issuers. Our Founder, Bill Hambrecht, is a Silicon Valley pioneer who has been financing growth companies from Apple to Google during his time at Hambrecht & Quist and WRH+Co. Since inception WRH+Co has been championing and financing emerging growth companies and currently has four Reg A+ offerings in process and several others preparing a Form 1-A for submission. Active offerings are Aperion Biologics, Allegiancy, BeautyKind and NewsBeat Social.

 

Elio Motors Raises Capital with Reg A+ IPO

March 08, 2016

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

Elio-Motors-Raises-Capital-with-Reg-A-IPO-980x588

Elio Motors is the first US based organization to raise capital using Regulation A+ — WR Hambrecht + Co Serves as Elio Motors’ Capital Markets Advisor

SAN FRANCISCO, CA, March 8, 2016 – On February 19, Elio Motors‘ shares launched on OTCQX. It became the first US-based organization to raise capital using Regulation A+, and also the first to have its shares publicly traded. Nearly $17M in funding was raised on the StartEngine Crowdfunding platform, and those shares are now trading on the OTCQX market. WR Hambrecht + Co serves as Elio Motors’ capital markets advisor and Designated Advisor for Disclosure (DAD), responsible for providing professional guidance on OTCQX requirements, U.S. securities laws, and corporate finance strategy.

WR Hambrecht + Co is currently marketing four new Regulation A+ offerings, acting as sole underwriter for Allegiancy Inc., Aperion Biologics Inc., BeautyKind, and NewsBeat Social.

“We’ve been engaged by a lot of great companies looking to take advantage of the new Regulation A, and I’m glad that we can now get started,” said John Hullar, Managing Partner. “We support the expansion of the Regulation A exemption, because it creates a new option for early-stage growth companies to access public markets through the A+ IPO, which benefits entrepreneurs and Investors, creates jobs and boosts the economy.”

In March 2015, the United States Securities and Exchange Commission (SEC) finalized rules under Title IV of the 2012 Jumpstart Our Business Startups (JOBS) Act, which paved the way for private companies to raise up to $50 million from accredited and non-accredited investors alike. This ruling is known as “Regulation A+.”

These Regulation A reforms will transform and reinvigorate a capital raising for smaller companies, their executives, and their early funders. W.R. Hambrecht + Co., LLC and its founder, Bill Hambrecht, have been longtime advocates for these reforms, and were cited over 40 times in the SEC’s adoption of the rule implementing these changes. WR Hambrecht +Co is now leading the efforts to take advantage of these changes to help numerous great companies obtain the capital they need to survive and grow.

About Elio Motors
Founded by car enthusiast Paul Elio in 2009, Elio Motors Inc. represents a revolutionary approach to manufacturing an ultra-high-mileage vehicle. The three-wheeled Elio is engineered to attain a highway mileage rating of up to 84 mpg, while providing the comfort of amenities such as power windows, power door lock and air conditioning, accompanied by the safety of multiple air bags and an aerodynamic, enclosed vehicle body. Starting MSRP excludes options, destination/delivery charge, taxes, title and registration. Anticipated production date is based upon timely receipt of requisite funding.

About WR Hambrecht + Co
WR Hambrecht + Co was founded in January 1998 to level the playing the field for investors and corporate clients. Like its predecessor firm, Hambrecht & Quist, WRH+Co seeks to identify high prospect growth-stage companies, and then enable access to the capital necessary to fund development, marketing and infrastructure so that these companies can achieve their full potential. WRH+Co’s Regulation A+ strategy is a continuation of Bill Hambrecht’s legacy of conducting small public offerings for what were once considered high-risk start-ups that are now household names and Fortune 500 companies.

Contact Helen Miazga at hmiazga@wrhambrecht.com, or 415-551-3237 or online at wrhambrecht.com.

Disclaimer
These securities are highly speculative. Investing in shares of Elio Motors, Inc. involves significant risks. This investment is suitable only for persons who can afford to lose their entire investment. To obtain a copy of the Offering Circular, go to http://www.eliomotors.com/equity or click here to download directly.

 

2016 J.P. Morgan Healthcare Conference

January 05, 2016

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+


2016 J.P. Morgan Healthcare Conference

Meet WR Hambrecht + Co at the Annual Healthcare Conference

It has been 34 years since Hambrecht & Quist (H&Q) held the first Healthcare Conference in San Francisco at the Westin St. Francis Hotel in January, 1983. Presenting companies at the first H&Q Conference included hospital operators, medical device manufacturers, a medical information services provider, and five biotechnology startup firms: Centocor, Collagen, Genentech, Monoclonal Antibodies, Inc. and Xoma.

The Conference has been an extraordinarily popular annual event since then. In 1999, after acquisitions, this must-attend meeting was renamed the Chase H&Q Healthcare Conference, then the J.P. Morgan Healthcare Conference. WR Hambrecht + Co, like its predecessor firm Hambrecht & Quist, seeks to identify high prospects growth-stage companies, and provide them with access to the much-needed capital necessary to fund development, marketing and infrastructure allowing them to achieve their full potential.

“We at WR Hambrecht + Co continue to be astonished at the energy, inventiveness and sheer horsepower exhibited by early stage life sciences companies out to improve the human condition and build significant enterprises along the way,”

WRH+Co’s Regulation A+ strategy is a continuation of Bill Hambrecht’s legacy of conducting small public offerings for what were once considered high-risk start-ups and are now household names and Fortune 500 companies. Currently WR Hambrecht + Co has three offerings on file under the new Regulation A+, Hunting Dog Capital Corp., Aperion Biologics Inc. and Allegiancy Inc. “We at WR Hambrecht + Co continue to be astonished at the energy, inventiveness and sheer horsepower exhibited by early stage life sciences companies out to improve the human condition and build significant enterprises along the way,” said Kurt Kruger, Partner, and leader of the healthcare practice.

Kurt Kruger
Partner, Healthcare
Kurt has enjoyed a 30 year career in Medical Technology. His deep involvement in the field has ranged from product design and development as a biomedical engineer to raising capital for, and following, publicly traded medical product companies as an equities research analyst. As a marketing manager at Guidant, Kruger developed the launch plans for the first-ever implantable defibrillator. As a securities analyst he showed uncommon perspicuity leading Hambrecht & Quist to provide venture funds for, and then take public, Ventritex, a high profile, Wall Street darling that was later acquired by St. Jude Medical. Kruger received an Sc.B. degree in Biomedical Engineering from Brown University; a Master’s degree in Bioengineering from the University of Michigan; and a business degree (S.M) from the Sloan School at the Massachusetts Institute of Technology (MIT). He also completed the premedical post-baccalaureate program at Columbia University.

What Regulation A+ Means for Investors

August 07, 2015

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

This is another installment in a series of blogs from W.R. Hambrecht + Co., LLC. In this series, we will explore the capital raising challenges facing small and emerging companies and recent regulatory changes that should greatly help executives, venture capitalists, and individual investors meet these challenges head-on.

Investing is almost always a risk/reward proposition. Most start-ups fail. But many don’t. The ones that are successful can lead to significant rewards for their early investors. Who wouldn’t want to have been an early investor in Apple or Google (two companies who we helped take public)? But how do you get to invest?

Until recently, the federal securities laws have largely prevented most ordinary investors from funding early-stage companies. Experienced angel and venture investors that were plugged into the groups, law firms, and brokers-dealers were able to see the deals. But ordinary investors were generally shut out of these opportunities.

Private placements couldn’t be advertised in public, and sales could only be to so-called “accredited investors.” So, if you knew somebody, and you have a lot of money, then you could participate. But if not, then you pretty much had to wait until after an IPO, if one ever came.

Regulation A+ Creates New Options for Investors

On June 19, 2015, revisions to Regulation A (often called Reg A+) became effective, and the world changed. Reg A+ allows companies to raise up to $50 million (including up to $15 million from selling shareholders) from the public markets.

Investors should know that there are two tiers of Reg A offerings. “Tier 1” offerings allow companies to raise up to $20 million, while “Tier 2” offerings allow companies to raise up to $50 million a year. The rules are very different for these two tiers, and investors should be cognizant of the differences.
For companies raising only smaller amounts of capital, but who don’t necessarily have audited financials or the ability to provide much in the line of ongoing reporting requirements, Tier 1 is an option. Investors should be keenly aware of the risks these companies present. These may be offered over the internet, likely with the help of a smaller law firm. Investors should be very careful to conduct their own due diligence of these offerings, particularly if there isn’t an investment bank involved. That’s because investment banks helping with offerings have to conduct basic levels of due diligence to ensure that the companies, the management, and the offerings are all legitimate. States’ regulations of these securities may provide additional protections, but may also limit how tradable and valuable the securities are for investors.

Tier 2 offerings provide significant additional protections for investors, but also additional costs for companies. Most importantly, companies who sell securities using Tier 2 have audited financials and have committed to providing ongoing reporting that should keep investors informed about key issues for the company.

As far as liquidity goes, there should be plenty of places for Tier 2 offerings to trade. For example, OTC Markets Group recently proposed revising its Standards for its OTCQB platform to accept the Tier 2 ongoing reporting as adequate to allow for quoting and trading on its platform. Of course, a company could list on NYSE or Nasdaq, and thus become a full Exchange Act reporting company (with full quarterly SEC filings). And we expect other trading venues to pop up as well. Thus, under Tier 2, no matter what, investors should be able to stay well-informed about their companies and have venues where they can trade their securities.

We expect that ordinary investors seeking to get in on great growth-stage companies may soon be able to access them. Finally. This is the democratization of capital.

If you are an investor looking to access great growth-stage companies, please contact us.

Press Release: Statement on SEC’s New Regulation A

June 22, 2015

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

FOR IMMEDIATE RELEASE: June 22, 2015

Helen Miazga
WR Hambrecht + Co
(212) 313-3237
hmiazga@wrhambrecht.com

W.R. Hambrecht + Co., LLC Statement on SEC’s New Regulation A

On Friday, June 19, 2015, new rules to expand and update Regulation A became effective, marking the first day that great small and emerging companies can now take advantage of them. These changes were mandated by Section 401 of the Jumpstart Our Business Startups Act (or JOBS Act), and were adopted by the Securities and Exchange Commission on March 25, 2015.

These Regulation A reforms will transform and re-invigorate a capital raising for smaller companies, their executives, and their early funders. W.R. Hambrecht + Co., LLC and its founder, Bill Hambrecht, have been longtime advocates for these reforms, and were cited over 40 times in the SEC’s adoption of the rule implementing these changes. We are now leading the efforts to take advantage of these changes to help numerous great companies obtain the capital they need to survive and grow.

“We’ve been engaged by a lot of great companies looking to take advantage of the new Regulation A, and I’m glad that we can now get started,” said John Hullar, Managing Partner. “As with any new thing, we’re working through some technical issues, but because so many of our clients are working through these issues at the same time, we’re moving quite quickly to match these great companies with investors eager to provide them with capital.”

About WR Hambrecht + Co: WR Hambrecht + Co was founded in January 1998 to level the playing field for investors and our corporate clients. Our Founder and Chairman, Bill Hambrecht, is a Silicon Valley pioneer that has been financing growth companies from Apple to Google during his time at Hambrecht & Quist and WRH+Co. The firm’s impartial auctions have dramatically changed the traditional investment banking landscape by allowing the market itself to determine pricing and allocations.

###

Regulation A+ Part Two:
Advantages for Founders, Employees, and Early Investors

May 04, 2015

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

This is another installment in a series of blogs from W.R. Hambrecht + Co., LLC. In this series, we will explore the capital raising challenges facing small and emerging companies and recent regulatory changes that should greatly help executives, venture capitalists, and individual investors meet these challenges head-on.


Growing a Small Businesses is Challenging

Even the most promising small companies have a lot of challenges. Two right at the top of the list are:

  1. attracting and retaining great employees and
  2. getting the capital they need to survive, adapt, and grow.

And as any good entrepreneur knows, the expansion from a handful of employees to the first 100 is often the hardest part. The company may be too large to keep financing it with your friends and family or with the angel investor(s) you’ve had all along. And banks won’t lend you nearly what you need.

Viable Options for Raising Capital Have Been Limited

In recent years, this dilemma has resulted in essentially one of two paths—multiple rounds of venture capital investing or selling out. Both may be viable options, but both present significant challenges for founders, employees, and early investors. With venture investors, a company’s early investors and founders may be heavily diluted each successive round—threatening the culture and vision of the firm. Although they help to pay salaries, these investments often hurt employee attraction and retention because they typically dilute employees’ interests. And being acquired is often the end of the ride.

Public financing for growth-stage companies has all but fallen off the table in recent years amid ever-climbing legal and compliance costs. Until now.

Regulation A+ Creates Viable New Options

On March 25, 2015, the SEC adopted revisions to Regulation A (often called Reg A+). This new rule puts public financing back on the table for great small and emerging companies. It allows management to raise capital from all types of investors, not just a handful of venture funds, giving them leverage to fight dilution and maintain their company’s culture. Just as important, Reg A+ opens up the valuation of the company beyond what just a small subset of the investing world might think. It gives employees freely-tradable securities that they can sell right away. If anyone wants to know the value of their holdings, they can just look to the public quote. And it gives early investors the opportunity to monetize some of their success.

Regulation A will allow companies to raise up to $50 million (including up to $15 million from selling shareholders) from the public markets. It throws open the doors to capital formation by giving a much larger pool of investors access to great companies. While there are some upfront costs and documentation requirements that don’t come with most private offerings, these costs should be less than those of a full IPO.

The Two Types of Regulation A+ Offerings: Tier 1 and Tier 2

Regulation A provides two tiers of offerings, with the filing obligations scaled to the size of the offering and the capabilities of the company. For offerings up to $20 million, “Tier 1” allows companies to raise capital without audited financials and without significant ongoing reporting requirements. For offerings up to $50 million, ”Tier 2” allows for abridged initial filings and ongoing reporting requirements, which should generally be far more streamlined than full Exchange Act reporting requirements, including the oft-dreaded Sarbanes-Oxley.

With lower costs and modest filing requirements compared to a fully-registered public offering, but with many of the advantages of one, we expect the new Regulation A to be an attractive option for founders, employees, and early investors.

Regulation A+ Part One:
Get Out of My Dreams, and into the new Regulation A

April 29, 2015

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

This is the first of a series of blogs from W.R. Hambrecht + Co., LLC. In this series, we will explore the capital raising challenges facing small and emerging companies and recent regulatory changes that should greatly help executives, venture capitalists, and individual investors meet these challenges head-on.


It Begins with a Dream

Every successful entrepreneur has, at least once in her life, dreamed about her company’s IPO. Finally. Stock that is publicly traded. Stock that she or her employees can sell—to anyone, at any time. Stock that she can use to borrow against, or sell or buy things with. Stock that, put simply, can make her—and her dedicated investors, employees, and supporters—rich. The crowning achievement of years of hard work. Her early venture investors have probably had a similar dream.

But these folks aren’t the only dreamers. Investors dream too. They dream of having access to fantastic small companies. They want to research, identify, and invest in promising smaller companies, ranging from biotechnology firms to restaurants to everything in between. They’ve been locked out of these investments, which have been the exclusive terrain of venture and angel investors. They want to find the next company developing a break-through cancer treatment, killer app, or fantastic food concept.

Closing the Distance from Dream to Reality

The one thing these dreams have in common is that, until recently, they looked a lot more like fantasy than reality. Well, it’s time for these folks to wake up, because the dream may be becoming reality—and sooner than we all thought. The SEC dusted off and fixed an old exemption from the securities laws and has just made it a lot easier for small and emerging companies to raise capital by selling debt or equity securities to the public.

Regulation A was never used much before, but in its latest incarnation, and unless the lawyers manage to mess this up (a possibility), there’s a great chance for it to revolutionize capital raising for small and emerging companies, and investing for individual and professional investors. We at WRH+Co have been pushing for these changes for years—and are thrilled that Congress and the SEC seemed to finally listen. The SEC cited us over 40 times in its final rule.

You can read the entirety of the Reg A+ final rule here. The document can seem a little intimidating, but the “Introduction” section provides a good, accessible overview beginning on page 6.

Introducing the New Regulation A

By now, many in the venture community have heard about these reforms to Regulation A. They know that it allows for public offerings of securities (up to $50 million!) without having to register with the SEC. And they know that these securities can be sold to anyone, not just the elite. Regulation A now allows companies, their founders, and early investors a way to both raise money, and monetize their existing positions.

There are also a lot of advantages for investors. First off, before now, most investors couldn’t even access these companies. They had to wait until the IPO several years later at the expense of substantial returns on investment. Regulation A now welcomes investors of all shapes and sizes. For sophisticated investors who would probably have made another private investment in the company anyway, this gives them liquidity they wouldn’t otherwise have. For ordinary investors, this gives them access to these terrific companies earlier.

Larger Regulation A offerings, known as Tier 2 offerings, will also have a number of critical investor protections that aren’t usually found in private offerings. For example, companies would need to provide audited financial statements and submit regular updates to the SEC. But, these updates are not the full-blown Exchange Act reporting requirements and the oft-dreaded Sarbanes-Oxley requirements; rather they are just straightforward updates on key company information. So the burden on companies shouldn’t be onerous.

The Reg A+ Opportunity Begins this Summer

To be sure, the biggest risk with Regulation A right now is that it’s new. These changes come into effect June 19th of 2015, and there are many details that still need to be worked out including issues related to how and where these securities will trade after an offering is made, how the state involvement will work, and just how onerous the initial filing requirements might be. But those topics will be for another part of the series. In the meantime, we think it’s time for companies, founders, executives, and investors to take a long, hard look at Regulation A—it might just be the opportunity you’ve been dreaming about.

Press Release: SEC Adoption of Regulation A Reform

March 25, 2015

Share on LinkedInTweet about this on TwitterShare on FacebookShare on Google+

FOR IMMEDIATE RELEASE: March 25, 2015

Helen Miazga
WR Hambrecht + Co
(212) 313-3237
hmiazga@wrhambrecht.com

WR Hambrecht + Co Statement on SEC Adoption of Regulation A Reform

Today, in an open meeting, the SEC Commissioners voted to adopt rules and forms related to the offer and sale of securities pursuant to Section 3(b) of the Securities Act of 1933 to implement Section 401 of the Jumpstart Our Business Startups Act (or JOBS Act). In doing so, the SEC has cleared a new path for capital raising by expanding and updating the Regulation A exemption for small issues. We believe this development has the promise to transform and re-invigorate a capital raising landscape that, in recent years, has grown increasingly challenging for smaller issuers as a result of industry consolidation, regulation and market structure.

WR Hambrecht + Co has long been an advocate for improving access to capital for small businesses. Based on his decades of experience working with growth companies as an investor and investment banker, our Chairman, Bill Hambrecht, has testified before the House Committee on Financial Services and presented to the SEC Advisory Committee on Small and Emerging Companies with our thoughts on spurring new growth in public capital formation and job creation for smaller issuers. We were honored that our commentary to the SEC was quoted extensively in the proposed Regulation A rules released in December 2013, and with today’s announcement, we once again would like to commend the SEC Commissioners for taking this important step in expanding access to capital markets.

“We’re already hearing from businesses across all sorts of industries who want to learn more about the changes in Regulation A and how they can take advantage of this powerful capital raising tool,” said John Hullar, Managing Partner at WR Hambrecht + Co. “We look forward to sponsoring and advising companies that want to raise capital through the expanded Regulation A exemption, which will enable them to invest in their business, stay independent and grow in the future. This is a breakthrough for companies that need growth capital, as well as for investors looking for real access to great small companies.”

About WR Hambrecht + Co: WR Hambrecht + Co was founded in January 1998 to level the playing field for investors and our corporate clients. Our Founder and Chairman, Bill Hambrecht, is a Silicon Valley pioneer that has been financing growth companies from Apple to Google during his time at Hambrecht & Quist and WRH+Co. The firm’s impartial auctions have dramatically changed the traditional investment banking landscape by allowing the market itself to determine pricing and allocations.

###


Additional information

View the SEC release here:

SEC Adopts Rules to Facilitate Smaller Companies’ Access to Capital

Morrison & Foerster Regulation A+ Final Rules Overview:

Final Rules Offer Important Capital Raising Alternatives