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  • Before You Launch, Get the Terms Right

  • Regulation A is having a moment.

    With SEC Chairman Paul Atkins stating that the Commission is looking to “better facilitate retail investor participation in private markets while preserving their protection with appropriate safeguards,” and a 2026 regulatory agenda explicitly built around capital formation, Regulation A is having a moment. Founders with a following are taking notice, and pitch decks increasingly include some version of the same pitch: “We have thousands of loyal fans. Let’s turn them into investors.” Yet amid the renewed enthusiasm, one belief keeps resurfacing that deserves some pushback: the idea that an engaged audience is, on its own, a fundraising strategy.

    To be clear, there is real power in raising capital from your community. We’ve worked with founders who built loyal, financially invested audiences of thousands of retail investors, and the benefits go well beyond the money raised. Those investors become customers, referral engines, and some of the loudest advocates a company will ever have. Regulation A, done well, is one of the few tools that lets a company build all of that at once.

    But it’s worth remembering: an audience does not qualify an offering, and enthusiasm does not satisfy the SEC. Before securities can be sold under Regulation A, the offering statement must be qualified by the SEC, a review process where the Commission examines a company’s disclosures, asks questions, and expects real answers, similar in many respects to a scaled-down S-1 review. That process often takes several months, and costs can add up, especially once marketing enters the picture.

    That’s where the real work begins. A following that engages with Instagram posts is not the same as a following that will wire $500 to an offering page. Turning the former into the latter takes a genuine marketing operation, one with an appropriate budget, a tested investor acquisition strategy, and a plan for the reporting obligations that continue well after the round closes. Once a Regulation A offering is qualified, failing to timely file required annual or semiannual reports may prevent an issuer from continuing its offering until it returns to compliance.

    None of this is a reason to avoid Regulation A. If anything, the current regulatory focus on capital formation makes now a better time than most to consider it. But the founders who succeed treat it the way it deserves to be treated: not as a shortcut unlocked by a large following, but as a disciplined capital-raising process made more effective by one.

    For a more in-depth discussion on this topic, check out this expert panel conversation on the state of Reg A Crowdfunding.

  • “One and done” SPV reporting? No, not really

    A few months ago, I posted about the received wisdom in the crowdfunding industry that
    holds that because an issuer used a special purpose vehicle to handle its offering under
    Regulation CF, that SPV counted as only one “holder of record” for ongoing reporting
    purposes. Therefore, the theory goes, issuers could take advantage of the provision in
    Rule 202(b)(2) that says if you have less than 300 holders of record, you can withdraw
    from the Regulation CF three-year reporting regime after you have filed one Form C-
    AR. This, despite the fact that the SPV, which may have more than 300 investors, is
    also an “issuer.” Despite the fact that the Proposing and Adopting Releases in 2020
    permitting the use of SPVs said absolutely nothing to sanction this early exit.

     

     

    Well, the SEC Staff reckon the received wisdom is wrong. In a new Corporation Finance
    Interpretation, the Staff says that crowdfunding SPVs are supposed to be conduits that
    pass along the same rights as if the investor had invested in the issuer directly. This
    includes three years of C-AR filings, unless there are fewer than 300 investors who
    invested in the offering or one of the other events in Rule 202(b) (such as becoming a
    registered public company) occur.

    We will be back shortly with a post to explain how issuers who failed to file all their C-
    ARs can get back into compliance.

  • Turning Fans Into Investors: Reg CF and Reg A for Creators

    Content creators have an unlimited supply of creativity to reach an audience. What they may not have is unlimited capital to make that content. But for creators that have spent years building a community who believe in what they make, not only can that community be the source of capital they are looking for, but that community may want the chance to own a piece of what the creator is doing.

    For instance, could you imagine owning a piece of MrBeast? At the DealBook Summit in December 2025, the CEO of Beast Industries mentioned his desire to make each of their 1.4 billion fans into owners. That can be a challenge under US securities laws when using a traditional IPO process. But giving fans ownership is possible using Regulation Crowdfunding (Reg CF) and Regulation A (Reg A). 

    The key difference between Reg CF/Reg A and a traditional IPO is how creators can reach their investors. Whereas IPO communication rules are restrictive, Reg CF/Reg A are ideal for the online world where digital communications can reach investors where they are when viewing a creator’s content. 

    And through Reg CF/Reg A, the community can become actual owners. It is not a donation, but an investment that will turn that community into stakeholders interested in the ongoing success of what the creator is doing. The emergence of platforms like GigaStar also reflects growing interest in investment models built around the creator economy, showing that audiences increasingly want to participate in creators’ success in new ways. Reg CF and Reg A have become increasingly relevant tools within the growing creator economy.

    The choice of Reg CF or Reg A will depend on the circumstances for a creator. Reg CF allows raising up to $5 million per year, while Reg A allows for raising up to $75 million. While Reg CF is a simpler process to launch an investment offering compared to Reg A, both require financial statements and disclosure documents that comply with SEC rules. That said, either are doable for creators that are able to keep their books and records organized, and are ready to provide regular financial disclosures to their community. 

    Before beginning down either path, content creators should evaluate the funding need and their community engagement; 50,000 committed fans may be more advantageous than 500,000 passive followers. 

    CrowdCheck exists to make this path navigable. We have helped hundreds of companies, including those in the entertainment and creator space, run compliant Reg CF and Reg A offerings. Maybe we can help you too.

  • Reg A Advertising on TV, Radio, and Online Audio/Visual Ads: What the SEC Staff Just Clarified (C&DI 182.28)

    One of the draws of Regulation A is that issuers can advertise their offerings on ways that were previously unheard of in the world of traditional registered offerings. Ads on Instagram and TikTok, podcast reads, streaming pre-roll, radio, or even a TV ad extolling the virtues of your company’s offering are all permissible under Regulation A. 

    There are, of course, SEC rules that Reg A issuers must follow when advertising their offerings in this manner – the most basic of which are:

    • Don’t lie. Or make any misleading statements at all. 
    • Don’t forget your “legends and links.” If you are doing the ad as part of your “testing the waters” then you need to include the SEC’s “No money…” legend, and once you’ve filed an offering statement with the SEC, you also need to provide the offering circular, which is typically done by providing a hyperlink to the 1-A filed on EDGAR. For TV or radio ads – or anything that isn’t clickable – there are “best practices” for complying with this – which we’ve written about in the past.  

    However, the rules governing TV, Radio, and Online Audio/Visual advertisements of a Regulation A offering also change based on when the ads are run. 

    On February 17, 2026, the SEC staff added C&DI 182.28, which answers the question—can I advertise my Reg A offering on TV/radio or via online audio/visual ads?—with a very securities-law answer: it depends. 

    The Staff identified three windows of a Regulation A offering, and how the advertising rules for TV, Radio, and Online Audio/Video ads change based on which window the issuer falls into when the advertisement is made.

    1. Before you file the Form 1-A (“Testing the Waters”): TV, Radio, and Online Audio/Visual Ads OK. 

    Before your you file your Form 1-A with the SEC, you are pretty much unconstrained by the type of media you use. Social media, broadcast media, and traditional print media are all fair game so long as they comply with Rule 255(b)(1)–(3)—the Regulation A “testing the waters” framework.  

    1. After the Form 1-A is filed, but before qualification: TV, Radio, and Online Ads Still OK. 

    Once the Form 1-A is on file (but not yet qualified), TV, radio, and online video/audio ads are still permissible, so long as they comply with the rules allow during this phase—oral offers are permitted, and written offers can be made if they comply with Rule 254 (and solicitations of interest continue to be permitted under Rule 255 – each of which require their own “legends and links” described further above).

    3. After qualification: TV and Radio Ads NOT OK. Online Audio/Video Ads Probably OK.  

    This is the headline that most issuers will care about. In its February 17, 2026 C&DI update, the SEC clarified that after qualification, you cannot advertise the offering on TV or radio because Rule 251(d)(1)(iii) requires post-qualification written offers to be “accompanied with or preceded by” the most recent offering circular, and traditional broadcast doesn’t realistically allow that.  Online audio/visual ads can be permissible after qualification, but only if the offers can be accompanied with or preceded by the most recent offering circular (i.e. a clickable link to the offering circular in the video description).  

    Takeaway: Once a Regulation A offering is qualified, advertising options shrink quickly. Pre-qualification, the rules give issuers meaningful room to build awareness through essentially all types of media. Post-qualification, however, the SEC’s framework requires that offers be delivered with or preceded by the most recent offering circular —which is easy to do online with a clickable link, and very hard (or impossible) to do in most traditional media (such as TV, radio, and print media).

    So what’s realistically left after qualification? Digital placements that can deliver the offering circular in the same user flow—think clickable ads where the offering circular is immediately accessible—are workable. But TV and radio spots, print ads, billboards, and other “broadcast” or static formats are largely non-starters because you can’t reliably pair them with the offering circular at the moment the offer is made.

    And yes—it’s frustrating. Regulation A is one of the few pathways where marketing really matters, because these offerings don’t sell themselves. Many early-stage issuers need broad reach, and a lot of them are trying to reach investors who still consume information through traditional channels. The irony is that the audience with the most investable capital isn’t always living on the same platforms where compliance is easiest.

    Nonetheless, there are plenty of Reg A success stories with companies raising $50m+, so it’s not impossible to generate significant investor interest under Regulation A’s advertising framework. Effectively utilizing the windows in your Regulation A offering process when you have maximum advertising flexibility is key to a successful marketing strategy. Securities lawyers that are well versed in Regulation A rules and regulations can help you navigate advertising your marketing strategy in a compliant manner. 

     1. It should be noted that the SEC did not address whether use of QR codes in lieu of a hyperlink to the most recent offering circular would be permitted for a TV ad – a suggestion we have to the SEC in our comment letter on the Concept Release, where we urged the SEC to adopt a more flexible approach to the OC delivery requirements.

  • “Securities Are Sold, Not Bought—But Reg CF Marketing Has Rules: The SEC’s New Reg CF C&DI Guidance”

    Advertising and marketing are crucial for Regulation Crowdfunding offerings. As the old sales adage goes – “Securities are sold, not bought.” But marketing an offering compliantly is just as important as the marketing itself, as few activities can get an issuer in regulatory hot water faster than running afoul of the SEC’s rules on promoting an offering.

    Fortunately, on February 17, 2026, the SEC staff updated its Regulation Crowdfunding Compliance & Disclosure Interpretations (C&DIs), and provided bit more clarity on how Reg CF offerings can be marketed in a compliant manner. 

    A few key takeaways: 

    • “Testing The Waters” Before An Offering Is Permitted. The SEC confirmed that an issuer may communicate orally or in writing to see if there’s interest in a contemplated Reg CF offering prior to filing a Form C.In these communications, the issuer must clearly state that (i) no money or other consideration is being solicited,; (ii) no offer to buy securities can be accepted and no part of the purchase price can be received until the offering statement is filed and only through an intermediary’s platform; and (iii) a prospective purchaser’s indication of interest involves no obligation or commitment of any kind. The SEC further noted that copies of any materials you use in this manner should be filed with the Form C – so make sure you that any advertising materials you use are compliant before dissemination. Finally, the Staff draws a line between “offers” and ordinary course communications: purely factual business information that doesn’t condition the market for a securities offering may be disseminated, but the SEC has historically interpreted “offer” broadly where publicity is used to build interest ahead of financing. 
    • Advertising The “Terms Of The Offering” is Permitted, But Heavily Constrained Off-Platform. The SEC confirmed that issuers can advertise “terms of the offering” in a Reg CF—but if that advertising occurs outside the intermediary’s communication channels on the platform, it’s generally limited to the narrow Rule 204(b) notice content. “Terms of the offering” are the amount of securities offered, the nature of the securities, the price of the securities, the closing date of the offering period, the planned use of proceeds, and the issuer’s progress towards its funding target. 
    • Video Advertising is Permitted (solong as it complies with Rule 204(b)).
    • Advertising That Doesn’t Include The “Terms Of The Offering” Is Not Restricted. If an advertisement doesn’t include any offering terms, the Rule 204(b) notice limitation doesn’t apply. So advertising your business generally is OK – just make sure it doesn’t mention the offering.
    • Third-Party Media Articles Can Constitute A Notice That Would Subject An Issuer To The Limitations Of Rule 204. C&DI 204.04 reads like a cautionary tale. A third-party publication (say, a friendly write-up in an online publication on your Company) has agreed to write an article about your Company, and you just so happen to be starting your Reg CF offering. What a great opportunity to promote your company and help your raise, right? Well, maybe not. A third-party publication can be treated as a Rule 204 notice if it advertises offering terms and the issuer is directly or indirectly involved in its preparation (e.g. if the company’s CEO is interviewed for the article). The Staff basically flags the practical problem: if the article contains any information on your offering, it’s deemed a notice – and at that point, it’s unlikely the article will comply with Rule 204’s content limits. If the article doesn’t advertise offering terms, it may not be a Rule 204 notice—though it could still be an “offer” under general Securities Act principles.  Takeaway: If you’re coordinating PR, treat it like securities communications. Issuer involvement + offering terms in a third party publication is the danger zone. 

    In general, it’s best to consult with a securities attorney familiar with Regulation Crowdfunding’s rules and regulations to make sure your marketing efforts are compliant. 

  • Why IPO Candidates Should Consider Regulation A First

    Financial newsletters are coalescing around the idea that 2026 will be the year of IPOs. To their credit, a number of high-profile offerings look likely to occur—SpaceX, AI players OpenAI and Anthropic, fitness app Strava, and others have already filed confidentially or announced plans for IPOs later in the year.

    However, especially for consumer-based companies, I can’t help but think that the conservative IPO route encouraged by their counsel and bankers is missing real opportunities to expand their stakeholder base prior to going public.

    Consider a company like Strava. Its valuation is based on growing its user base and converting free users into paid subscribers. That requires increasing users’ interest in the company itself, not just the service. After all, if a different service comes along offering a similar or better experience, users will migrate to that new option.

    What will keep those users loyal is if they have a financial stake in the company’s success. A traditional IPO won’t create that dynamic, as the offering will be filled by institutional investors and funds. Retail investors won’t own a piece just because they like the company. However, they would if they were invited to participate in an offering under Regulation A.

    Compared to a registered offering, Regulation A provides much more freedom to communicate with retail investors. Companies can contact investors via email, social media, or through an app. Users could also be given incentives and perks that align with a company’s marketing mission for paid user growth. Further, those users would become stakeholders with a vested interest in the company’s success, not just the product or service being offered. This type of earned loyalty may deliver significant benefits as the company moves toward its IPO.

    Conservative counsel and bankers may think a Regulation A offering introduces too many market risks. However, there are likely solutions they’re not considering. For instance, the terms for a Regulation A offering could include a lock-up or other trading limitations to ensure there are no issues on the initial trading day during the subsequent IPO. With proper planning, solutions are available for those perceived risks.

    Since the amendments to Regulation A in 2015, companies have successfully used this mechanism to raise capital, engage their user base, build their brand, and prepare for going public. I believe more companies should have caught onto its potential by now, but perhaps that will also become a theme for 2026.

  • “One and done” SPV reporting? Really?

    It’s Form C-AR filing season again, and maybe time to discuss an interesting consequence of using a crowdfunding special purpose vehicle (“SPV”). These are used in roughly one quarter of all Regulation CF filings, according to the analysis of our colleagues at Kingscrowd. 

    Everyone in crowdfunding knows that once a company has taken money from investors in an offering subject to Regulation Crowdfunding, it must provide updates to those investors in annual Form C-AR filings. (Sadly, not everybody in crowdfunding actually complies with that requirement. Kingscrowd data shows a significant decline in ongoing reporting from dismal to an appalling 24.4% for the most recently completed reporting period.)

    The filing requirement generally continues for three years but if an “issuer” (explanation coming up) has filed at least one C-AR and has fewer than 300 “holders of record” it may terminate reporting, by filing a Form C-TR.

    Back in 2021, it became legal for crowdfunding companies to use SPVs, bundling all human investors into an entity that showed up as one entry on the cap table. The SEC made this work by saying that both the company and the SPV were “co-issuers” and could file on the same Form C. There was a lot (and I mean a LOT) of discussion about the consequences of permitting the use of SPVs, both in the release that proposed this structure, and the release that adopted the new rules. But in neither the Proposing nor the Adopting Release was there a word about the impact on ongoing reporting requirements. So one would have THOUGHT that those ongoing reporting requirements would be unchanged. Now the issuing company only has one “holder of record” – the SPV (plus any non-natural persons investing) but the SPV is also an issuer, and it will have all the human investors on its books as holders of record, and Rule 202(b) says “an issuer” must continue to comply with the ongoing reporting requirements. So you might THINK that investors should get their three years’ worth of updates that way.

    Wrong. Current practice is that a company counts the SPV as one holder, and disregards the fact that more than 300 investors may hold through the SPV, and we understand that this is not a position that will be challenged by the Staff*.

    You have to ask why a change that resulted in less information flowing to investors wasn’t flagged in the rulemaking process as a consequence of the rule change, and a deliberate policy choice. Although the more pertinent question may be “Sara, why the moral outrage about the rules permitting fewer filings when no-one is making those filings in the first place?” I have no answers.

    *Of course only the Staff can say whether this is accurate. [Added Feb 19.]

    *And in fact they did say current practice is non-compliant, by way of a CFI on July 9, 2026. [Added July 15.]

  • AI and Fraudsters are Upending Indicia of Trust in Online Investments

    The SEC recently brought an enforcement action against persons who created a fake trading platform for crypto, in which investors were contacted through messaging apps and encouraged to deposit funds in exchange for the crypto products being offered. See, https://www.sec.gov/newsroom/press-releases/2025-144-sec-charges-three-purported-crypto-asset-trading-platforms-four-investment-clubs-scheme-targeted. While investment scams are not new, this scam brings together new elements that upend some of the indicia of trust investors should be looking for. 

    At CrowdCheck, we were founded on the premise of “why would anyone invest in an unknown company over the internet?” The same is true for crypto. Still, these scammers formed a real corporation in Colorado, made exempt reporting adviser filings with the SEC, and created a platform that investors could interact with. Those elements together were enough to convince investors that the opportunity was real.

    What those investors didn’t realize is that the state and SEC filings did not include any regulatory oversight or approval of the business. Further, AI is changing web and software product development so that it is easy to create a realistic looking platform for users to interact with. Victims in this scam may have relied on those elements as indicia of trust to their detriment.

    There are real differences between the type of activity and regulatory oversight of different categories of investment intermediaries. State filings should be backed up by confirmations of good standing. That is just a start to the due diligence necessary before making an investment in an unknown company over the internet, and is why companies and intermediaries use CrowdCheck to protect their investors and demonstrate trust when they are competing with scammers for attention. 

  • SEC Announces Examination Priorities.

    On November 17, 2025, the SEC released its annual examination priorities covering all categories of entities under its supervision. These include broker-dealers, investment advisers, FINRA, as well as funding portals operating under Regulation Crowdfunding.

    Although the list of priorities specific to funding portals is shorter than those for other regulated entities, it still signals the areas where the SEC believes compliance gaps may exist. In particular, the SEC plans to focus on funding portals’ relationships with qualified third parties responsible for holding investor funds in escrow, the adequacy and preservation of their records, the sufficiency of their written policies and procedures, and their implementation of the 2024 amendments to Regulation S-P.

    The funding portal examination priorities is provided below:

    Funding Portals 

    The Division will focus on funding portal arrangements with qualified third-parties regarding the maintenance and transmission of investor funds and examine whether funding portals are making and preserving required records.  In addition, the Division will review funding portals’ written policies and procedures to assess if they are reasonably designed to achieve compliance with applicable federal securities laws and rules relating to its business as a funding portal.  After the compliance date, the Division may also examine funding portals for compliance with the 2024 amendments to Regulation SP, including the safeguards rule, the disposal rule, and the requirement to establish incident response programs.*   

    * (1) requiring [funding portals] to develop, implement, and maintain written policies and procedures for an incident response program that is reasonably designed to detect, respond to, and recover from unauthorized access to or use of customer information; (2) requiring that the response program include procedures for [funding portals] to provide timely notification to affected individuals whose sensitive customer information was, or is reasonably likely to have been, accessed or used without authorization; and (3) broadening the scope of information covered by Regulation S-P’s requirements