Reg A+, a securities exemption that was improved under the JOBS Act, has been touted as the solution to the dearth of IPOs in the US. But issuers are still working to figure out the best avenue to raise capital and then publicly trade shares. The first issuer to accomplish this task was Elio Motors. Elio crowdfunded under Reg A+ on StartEngine and then quickly listed shares on OTC markets. Now we have Myomo, a company that is raising money on Banq, part of Tripoint Global. Myomo wants to follow the funding round with a listing on the NYSE (MKT) – a first for a Reg A+ issuer.
As of January 31, 2017, there were 181 offerings filed using Regulation A+, 103 of which have been qualified by SEC staff for the issuer to begin making sales.
28 issuers have reported selling approximately $259 million in aggregate using Reg A+.
Myomo is a commercial stage medical robotics company with a vision to provide expanded mobility for individuals suffering from neurological disorders and upper limb paralysis. Myomo’s technology, licensed from Massachusetts Institute of Technology, restores a patient’s ability to use their partially paralyzed or weakened arms and hands again so that they can return to work or just improve their quality of life.
In 2006, the Myomo was spun out from MIT and became the exclusive licensee of two patents that are behind the technology. Since then, Myomo has launched three generations of its product and expanded its patent portfolio. The latest generation “MyoPro” custom-fabricated orthosis is specified for each patient. The MyoPro is a myoelectric arm that can enable individuals to self-initiate and control movements of a partially paralyzed or weakened arm and hand using their own muscle signals. When the user tries to bend their arm, sensors in the MyoPro brace detect the weak muscle signal, which activates the motor to move the arm in the desired direction. The user is completely controlling their own arm and hand; the brace amplifies their weak muscle signal to help bend and move their arm. With the orthosis, a paralyzed individual can perform activities of daily living including feeding themselves and doing household tasks.
Myomo says it has previously raised over $20 million from other investors including Mountain Group Capital. The company hopes to raise up to $15 million in its IPO under Regulation A+. Shares will be priced at $7.50 each. The capital raised will be used to repay certain debt agreements and to provide working capital to grow the business. Following the crowdfunding round, Myomo expects to be listed on the NYSE MKT as “MYO” (subject to NYSE approval). If they are not able to meet the NYSE MKT requirements they will provide liquidity on OTC Markets. Potential investors should review the Reg A+ Offering Circular to learn more about the securities offer.
Paul R. Gudonis, CEO of Myomo, said he was excited to offer investors the chance to participate in their company alongside accredited and institutional investors.
“While a traditional public offering is generally reserved for large institutions and the Wall Street elite to invest at this stage, we are taking advantage of new SEC regulations to level the playing field for all investors to participate concurrently in our IPO,” said Gudonis.
Mark Elenowitz, CEO of TriPoint, said he was thrilled to help Myomo become the first company to offer shares under Reg A+ and then list on the NYSE.
“It has been 84 years since the Securities Act of 1933 was enacted, but with the Title IV of the Jumpstart Our Business Startups (JOBS) Act, Myomo leads us into exciting new territory where Main Street meets Wall Street.”
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