The Securities and Exchange Commission (SEC) has announced it is looking for candidates for the Small Business Capital Formation Advisory Committee (SBCFAC).
The SBCFAC crafts recommendations to submit to the Commission advocating on behalf of smaller firms in need of capital. This includes feedback on topics like securities crowdfunding, the definition of an Accredited Investor, and creating opportunities for early-stage firms. Frequently, the Commission’s rules ignore the needs of emerging firms.
The SEC states the relevant experience for candidates include:
- Representing emerging companies engaging in private and limited securities offerings or considering an initial public offering (IPO), professional advisors of such companies (including attorneys, accountants, investment bankers, and financial advisors), and investors in such companies;
- Service as an officer or director of minority-owned small businesses or women-owned small businesses;
- Representing smaller public companies, the professional advisors of such companies (including attorneys, accountants, investment bankers, and financial advisors), and the pre-IPO and post-IPO investors in such companies; and
- Representing participants in the marketplace for the securities of emerging companies and smaller public companies, such as securities exchanges, alternative trading systems, analysts, information processors, and transfer agents.
While the Committee has provided many common-sense recommendations to the Commission, few of these recommendations have been pursued. A good example is the definition of an Accredited Investor. For several years, different iterations of the Committee have told the Commission to expand the definition to make it more inclusive and easier for smaller investors to participate in Reg D private placements. The SEC currently wants to make it more difficult to be deemed Accredited.
Members of the public interested in serving on the committee should email a letter of interest to smallbusiness@sec.gov, including information about their experience.
The deadline for submissions is June 14, 2024.
