Dodd-Frank Act
ACA's Advocacy Work: To ensure a healthy base of angel investors could support innovative startups, ACA worked with Sen. Dodd's staff and a bi-partisan group of Senators to remove these sections and replace them an "angel amendment" that kept the accredited investor standard for net worth at $1 million, although the value of the individual's primary residence would not count toward the $1 million. The standard for income remained the same.
Important Changes for Angels and Entrepreneurs
The final legislation removed the provisions that concerned ACA related to Regulation D - so there is no 120-day waiting periods for approval of offerings and no patchwork of different state regulations for entrepreneurs raising capital. Instead, Section 926 adds more abilities for regulators to stop Regulation D private offerings from "bad actors." The final act also eliminated automatic inflationary increases to the definition of "accredited investor" that would have decreased the number of angels in angel groups by about 60 percent (based on source data from the "Returns of Angels in Groups" academic study). However, Section 413 does include compromise language for net worth requirements, which stay at $1 million but exclude primary residence from the calculation. |