How It Works

Overview
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The JOBS Act equity crowdfunding rules put a huge amount of burden and risk on equity crowdfunding portals. In addition, funding portals that are involved with general solicitation of 506(c) offerings face new rules and regulations to insure regulatory compliance. In order for equity crowdfunding to fulfill its promise of reinventing the way small businesses are financed, and in order to fully take advantage of the ability to generally solicit investors under 506(c), funding portals need an affordable means of maintaining compliance. FundHub works with funding portals to implement plug-ins for your site that allow us to handle much of the compliance burden for you with an extremely secure API that guarantees investor privacy. At FundHub, we do the behind-the-scenes regulatory and compliance work so your funding portal can do what it was designed to do: offer equity crowdfunding and 506(c) offerings to investors and help businesses launch and grow, reinvigorating the American economy.
JOBS Act Investor Levels
JOBS Act Investor Levels
When equity crowdfunding under the JOBS Act goes into effect, funding portals will take the brunt of the liability if something goes wrong, based upon the SEC's proposed rules. Compliance with the JOBS Act is imperative as a result, and FundHub is here to provide all the compliance services needed for a funding portal to flawlessly handle equity crowdfunding. FundHub's API will plug directly into any funding portal and perform compliance behind the scenes, determining whether which JOBS Act equity crowdfunding category investors fit into, determining who must the investor is allowed to invest, and tracking the investors' annual investment amounts to guarantee JOBS Act compliance.
Regulation D Bad Actor Check
Regulation D Bad Actor Check
In 2013, the SEC dramatically changed the rules for many private equity offerings and now requires the disqualification of felons and other "Bad Actors" from some investment offerings. These new consumer protection provisions are a field of landmines for an entrepreneur of company raising money, who now must disclose if officers, directors or certain minority shareholders have felony convictions or have run afoul of other Bad Actor provisions. FundHub efficiently and economically researches these matters for funding portals. At FundHub, we thoroughly vet every "covered person" of an issuer to be sure there are no "bad acts" hiding in the shadows. FundHub will certify a "covered person" as passing our stringent "Bad Actor" test, and will provide evidence of any "bad acts" we find so the issuer may disclose them as part of the offering. FundHub's service is fast, reliable and affordable. We take away the worry, and make compliance easy.
JOBS Act Bad-Actor Check
JOBS Act Bad-Actor Check
In their 585 pages of proposed JOBS Act equity crowdfunding rules, the SEC has proposed regulatory and background checks for certain officers, directors and others involved with an issuer. These proposed rules appear very similar to the rules disqualifying felons and other "Bad Actors" from Regulation D offerings. FundHub will provide an economical and efficient means of vetting issuers to be sure there are no "bad actors" that will cause problems for a funding portal with the offering. Just as we do with Regulation D offerings, FundHub will certify that all of the key personnel of an issuer pass our stringent background tests, and will provide funding portals with evidence of any problems we find so the issuer and funding portal may disclose them as part of the JOBS ACT equity crowdfunding offering. FundHub's service takes away the compliance concerns for funding portals, making entry into the JOBS Act equity crowdfunding market painless and profitable.
Mini PPM
Mini PPM
One of the biggest expenses for any issuer is creating a private placement memoranda for a Regulation D offering. With equity crowdfunding under the JOBS Act, there are lessened but still substantial disclosure requirements. Funding portals, broker-dealers and issuers will undoubtedly need to produce some form of disclosure document. Law firms will charge exorbitant amounts to produce these memoranda, and in many cases, there is no need for such a huge expense. At FundHub, we will create a draft Mini-Private Placement Memorandum (Mini PPM) for the issuer to cut the legal costs involved to a minimum. Our JOBS Act equity crowdfunding Mini-PPMs are tailored to the applicable federal and state laws involved in each case, and are created through an easy-to-use online interface, then reviewed by FundHub's internal compliance staff, before being available to print directly from our site. With our simple and affordable Mini-PPM generation tool and our compliance review, issuers can easily generate a near-perfect Mini-PPM for the issuer's counsel to quickly review and approve. FundHub will even provide funding portals with a list of securities attorneys who will review the documents and provide you with legal opinions and services at a reduced rate to finish the process.
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Reg D & JOBS Act 101
Reg D & JOBS Act 101
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