cMEcompete, a social platform for endurance events such as triathlons, marathons or bike races, has become the first platform to issue equity through online crowdfunding to non-accredited investors. There are more than 35,000 such events in the United States each year.
The opportunity was allowed after state officials approved the Invest Georgia Exemption (IGE) in 2012, which makes it easier for companies to raise capital.
“IGE loosens restrictions on how new and small Georgia-based businesses can raise capital from the public market,” explained a recent SterlingFunder blog. “IGE permits intrastate Crowdfunding.”
As of March, Georgia and Kansas were the only U.S. states to allow such equity-based crowdfunding. Industry analysts are eager to watch what unfolds.
“I was thrilled to learn that the first online equity crowdfunding campaign allowing unaccredited investors to invest went online this week,” Alon Goren, CEO and co-founder, InvestedIn, said in a statement. “This is a big step forward, and I hope that more states will consider passing their own laws to jumpstart investment into new companies, as Georgia has done here.”
Still, it’s just a start, and Goren said it will be “a while before equity crowdfunding becomes a reality nationwide, but shining the spotlight on projects like these in states with a progressive attitude toward crowdfunding can only benefit the community.”
“These are exciting times with state law makers removing barriers for startups,” Dan Popovic, the founder of cMEcompete, added. "Now it is time for Georgians to take advantage of this opportunity by investing in new Georgia businesses and fueling the State’s economic recovery. cMEcompete is proud to be the first platform for this historic opportunity.”
Edited by Rachel Ramsey