As initial public offerings (IPO) sink due to a one-two punch of a challenging market and the never-ending onslaught of additional regulations foisted upon issuers, the SEC’s Small Business Capital Formation Committee has scheduled a meeting to discuss IPOs as well as entrepreneurship hubs.
The Committee will first address entrepreneurship and startup formations across the country – which tend to be concentrated in areas like the San Francisco Bay area or New York City. Online capital formation or investment crowdfunding has helped to alleviate this issue empowering entrepreneurs anywhere to raise growth capital online – yet things can be improved.
The second segment of the meeting will review “economic conditions, recent changes in IPO activity and other factors [which] may impact companies going public.”
The Committee states:
“Experts in the field will share market data and insights with the Committee, and address how pathways to going public, including traditional IPOs, reverse mergers, SPACs, and direct listings, have been impacted.”
One of the SEC’s missions is to enable capital formation but current leadership has been lambasted by some as an “anti-capital formation” Commission. The SEC’s recent tack has focused mainly on investor protection almost exclusively. Forthcoming new rules like climate disclosure requirements will undermine public markets even further. It will be interesting to see if the Committee addresses these challenges.
The Committee holds a mandated task to advise the Commission on policy matters related to small business but there is no requirement to act on the recommendations as we have seen in the past.
The meeting which will be live-streamed and available to the public will take place on October 13th.
The agenda is below.
Meeting of SEC Small Business Capital Formation Advisory Committee
Location: Public will be able to view on www.sec.gov
Date: Thursday, October 13, 2022
Time: 10:00 a.m. – 3:00 p.m. (ET)
10:00: Call to Order; Introductory Remarks by Commissioners
10:15: Entrepreneurial Ecosystems: Exploring the common ingredients in vibrant ecosystems
What are key elements that underpin a thriving entrepreneurial ecosystem? The Committee will hear from experts regarding common ingredients for building a vibrant ecosystem, including a historical overview of what characteristics have made other ecosystems successful. Committee members will discuss various factors that make an entrepreneurial ecosystem work effectively, the sequencing of events, and what cities, universities, lawmakers, regulators and other stakeholders can do to support these environments. Committee members and speakers will discuss what works well in various communities, sharing personal and professional experience, data, and history, to explore ways to continue supporting small business growth across the country.
Speakers:
- Charles Becker, Professor of Practice and Managing Director, SURE Program, University of Houston, C.T. Bauer College of Business
- Maryann Feldman, Watts Endowed Professor of Public Affairs, Arizona State University
12:15: Lunch Break
1:30: Update on the Going Public Market: A 12-month look back at the state of play of the IPO market
IPO activity dropped significantly in the first half of 2022. The Committee will examine the state of play in the IPO market over the last year, particularly in light of macroeconomic conditions, including inflationary pressures, a tighter investing environment, and numerous recent SEC rulemakings. Experts in the field will share market data and insights with the Committee, and address how the various pathways to going public have been impacted, including traditional IPOs, reverse mergers, SPACs and direct listings.
Speakers:
- Matthew Toole, Director, Deals Intelligence, Refinitive
- Michael Bellin, Partner, Consulting Solutions, US IPO Co-leader, PWC
3:00: Wrap-up and Adjournment
