Disqus - Friends of mcbuzz

Re: Regulation of VCs: What's the Impact on Startups & Emerging Companies?

Joe Wallin — Tue, 23 Jun 2009 14:44:04 -0000

Bill, as a practical matter you might be right, but the libertarian in me keeps thinking--wouldn't the money spent complying with new regulations be better spent funding a new startup? I like the fact that you are going to follow these new regulations with me. Thanks for providing this analysis.

Re: Dodd to Startupers: "Let's Make it Just That Much Tougher to Raise Angel $$"

Joe Wallin — Sun, 15 Nov 2009 13:56:11 -0000

I agree with you Bill. I don't think that this sort of reform is a necessary or appropriate response to the financial crisis. Same with the requirement that venture funds be subject to new reporting requirements.

Even more troubling than raising the "accredited investor" standard is allowing states to impose their own requirements on accredited investor offerings (by taking them out of the category of federal "covered securities")--this will substantially raise legal costs for companies trying to raise capital, making it more difficult and onerous to do so.

Sort of reminds me what Congress did with Section 409A, applying it to very early stage companies. That did nothing but burden early stage companies with additional costs, and create a cottage industry for appraisal firms. It was not helpful reform for promoting the startup community. But I don't really think that Congress is focused on trying to help small businesses or startups.

Re: Why Would Dodd Want to Gut Reg D Anyway?

Joe Wallin — Tue, 24 Nov 2009 14:26:48 -0000

If you want, you can sign the petition urging Congress not to do this here: http://gopetition.com/onlin...

Re: Senator Dodd – Making it harder for small businesses to get funded

Joe Wallin — Tue, 24 Nov 2009 18:19:44 -0000

Jason, thank you for posting on this topic. I hope someone in Congress stops this.

Re: Senator Dodd – Making it harder for small businesses to get funded

Joe Wallin — Tue, 24 Nov 2009 23:46:36 -0000

Jay, because of federal preemption, all states can generally do now in addition to taking the Form D is impose a fee in connection with a required notice filing. See Section 18(c)(2)(A) of the Securities Act of 1933 ("Nothing in this section prohibits the securities commission (or any agency or office performing like functions) of any State from requiring the filing of any document filed with the Commission pursuant to this title, together with annual or periodic reports of the value of securities sold or offered to be sold to persons located in the State (if such sales data is not included in documents filed with the Commission), solely for notice purposes and the assessment of any fee, together with a consent to service of process and any required fee.)". Without federal preemption, states could and would do a lot more, like impose merit review on securities offerings in their states.

In fact, Section 18(a) of the Securities Act lists the things states used to do, such as: requiring registration or qualification of securities, prohibit, limit, or impose conditions upon the use of offering documents; prohibit, limit, or impose conditions, based on the merits of such offering or issuer, upon the offer or sale of securities.

Repeal this law you would go from one national, simple rule to potentially 50 different rules, none of which are consistent with one another. It would be a big step backwards to do this, and impose a lot of additional cost and expense on early stage companies.

Re: Senator Dodd – Making it harder for small businesses to get funded

Joe Wallin — Wed, 25 Nov 2009 00:49:19 -0000

Bill, thanks, but I think credit belongs to Alan M. Parness of Cadwalader, Wickersham & Taft LLP for finding this.

Re: Public Policy and Venture Capital

Joe Wallin — Thu, 03 Dec 2009 12:11:35 -0000

Please sign the petition protesting the repeal of federal preemption of Reg D all accredited offerings. Petition can be found here: http://gopetition.com/onlin.... Thanks!

Re: VC firms could see tax hike

Joe Wallin — Fri, 04 Dec 2009 17:19:23 -0000

In addition to being subject to ordinary income tax rates rather than capital gains tax rates, the change will also probably subject the carried interest to employment taxes.

Re: A Call to Action: Fred Wilson Highlights Public Policy Initiatives Impacting Startups, Including Dodd's Bad Proposals

Joe Wallin — Sat, 05 Dec 2009 00:01:14 -0000

At one point the Obama administration proposed reducing the capital gains tax rate on investments in qualified small business stock to ZERO. http://bit.ly/8sS4CE I wonder if the administration will pick this idea back up as it looks for ideas on how to create jobs.

Re: VC firms could see tax hike

Joe Wallin — Sun, 06 Dec 2009 21:58:28 -0000

I agree Bill. I think a zero percent capital gains tax rate on qualified small business stock would really propel capital formation in startups and get hiring going at the startup level in a real significant way.

Re: Observations From a Silicon Valley Start Up Lawyer and Former SEC Attorney on Proposed Reg D Changes

Joe Wallin — Tue, 08 Dec 2009 18:52:00 -0000

Great comments Mike!

Re: Blackberry apps

Joe Wallin — Wed, 16 Dec 2009 10:50:26 -0000

I personally think Viigo is the best app out there for the Blackberry.

Re: Obama's call for capital gains cut could supercharge startups

Joe Wallin — Thu, 28 Jan 2010 15:17:13 -0000

I really hope the President succeeds with this proposal.

Re: Obama's call for capital gains cut could supercharge startups

Joe Wallin — Sat, 30 Jan 2010 15:57:25 -0000

Couldn't we have a literal flood of cash? I think startups starved for cash in Seattle would like to see this.

Re: Dodd's attack on angel financing

Joe Wallin — Mon, 15 Mar 2010 19:28:17 -0000

Isabella, thanks for your comments. I agree with you. We need to see if we can't get action out of our state senators on this issue.

Re: Dodd's attack on angel financing

Joe Wallin — Mon, 15 Mar 2010 20:48:03 -0000

I think that's a great comment Joe.

Re: Dodd's attack on angel financing

Joe Wallin — Mon, 15 Mar 2010 23:38:57 -0000

I think you are right Skip. I think they are going to be literally flooded with paperwork if this happens...

Re: Yep, It's Still There, as Ugly as it Was Last Fall: Sen. Dodd's Attack on Angel Financing

Joe Wallin — Tue, 16 Mar 2010 11:37:46 -0000

Bill, I think you are right. If this bill passes, the SEC will pass rules carving out from SEC review the vast majority of angel financings, and essentially delegate review of those to each state in which an offering is made. This will be painful and expensive for startups.

Re: Dodd's attack on angel financing

Joe Wallin — Tue, 16 Mar 2010 16:31:26 -0000

Thank you Dan. Great comments!

Re: Dodd's attack on angel financing

Joe Wallin — Wed, 17 Mar 2010 14:02:30 -0000

Derrick, thanks for your comments. I agree with you completely. This is a ridiculous proposal. Let's hope it does not become law.

Re: Will the Last Startup Left Standing Please Turn Off the Lights

Joe Wallin — Sat, 20 Mar 2010 13:30:50 -0000

Bill, I just can't understand why Congress would want to make life even more difficult for entrepreneurs to start and get funded early stage companies. I don't see the connection between Dodd's proposal and the financial crisis we suffered.

Re: Will the Last Startup Left Standing Please Turn Off the Lights

Joe Wallin — Sat, 20 Mar 2010 16:18:11 -0000

One of the proposed amendments would strike the exemptions for private equity and venture capital advisers from having to register as investment advisers.

Re: Dodd Bill Could Render Startups Too Small to Succeed

Joe Wallin — Tue, 23 Mar 2010 06:22:52 -0000

James, thanks for writing about these issues. Hopefully these proposals won't become law. Please keep writing about them.

Re: Startups Get Hit By Shrapnel In The Banking Bill

Joe Wallin — Sat, 27 Mar 2010 20:08:05 -0000

Fred, under the healthcare bill, Medicare taxes will apply to capital gains, including capital gains from sales of stock in startup companies.
"The legislation would for the first time apply Medicare taxes to investment income received by these households, beginning in 2013. The 3.8 percent rate would apply to unearned income such as realized capital gains, dividends, interest, rents and royalties." http://www.bloomberg.com/ap...

Re: Picking a Law Firm: How Size Does and Doesn't Matter

Joe Wallin — Thu, 22 Apr 2010 10:34:38 -0000

Thanks for your post on this Bill. It is great to see such a good discussion.