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The latest news and information for entrepreneurs from across the web universe, brought to you by the Report on Small Business team.
Equity-based crowdfunding (with a catch)
U.S. legislation kicked in Monday that enables startups to raise up to $1-million (U.S.) a year online without having to register shares for public trading, The New York Times reports. For years, small-business owners running early stage ventures have complained about a lack of access to capital, something the Jumpstart Our Business Start-Ups (JOBS) Act south of the border was intended to address.
Websites such as Kickstarter and Indiegogo, which are both operating in Canada as well, are known as crowdfunding sites that have been able to solicit donations from the general public, but not equity investements. The catch now in the United States is that funding, according to the Times story, can only be solicited from "accredited investors: people with a personal net worth of more than $1 million or who make more than $200,000 in annual income."
In Canada, as The Globe and Mail has reported, provincial securities commissions are still debating whether crowdfunding that enables investors to take an equity stake should be permitted. Concerns have been cited by informed market watchers because of the potential for fraud. New Brunswick premier David Alward has asked for a crowdfunding study, the British Columbia Securities Commission is circling the topic, and the Ontario Securities Commission is considering a crowdfunding prospectus exemption, among others.
Angel network releases annual report
The Network of Angel Organizations – Ontario (NAO-Ontario) on Monday said in its 2012-13 annual report that its membership has climbed to 946 accredited investors who among them funded 77 new early stage ventures in the province. "The growing ranks of organized angel investors ... have significantly helped early-stage companies fill their initial round of financing," NAO-Ontario said in a press release. Since 2007, it added, the organization has invested in and leveraged $255 million of private direct investment into 169 Ontario companies, and resulted in the creation of more than 2,200 jobs. NAO-Ontario administers the province's Angel Network Program on behalf of the government with a goal of providin mentorship and capital for innovative startups.
Adviser to funder
Silicon Valley-based AngelList, which was set up to connect entrepreneurs with investors, has just raised $24-million in funding, Fortune revealed Sunday. More than 100 individuals and organziations contributed, including Google Ventures. "This is not the first time that AngelList has raised funding ... but this is the deal that could help transform AngelList from a popular project into one of Silicon Valley's top power players," the story says. Forbes followed up Monday with more details.
EVENTS AND KEY DATES
Four-day manufacturing conference
The Canadian Manufacturing Technology Show takes place in Mississauga, Ont., from Sept. 30 to Oct. 3. More than 600 exhibits, including more than 150 new products – will be on view, in addition to expert speakers, interactive panel discussions, and conference sessions. According to conference organizers, a recent survey of small and medium-sized businesses indicates two-thirds of manufacturers are optimistic about business growth over the next 12 to 18 months.
John Spence in Calgary
Results Canada Inc. and Productivity Alberta are bringing John Spence to Calgary for an educational workshop aimed at improving your business by turning great ideas into action. On Sept. 26 from 8 a.m. to 5 p.m., Mr. Spence, among other topics, will discuss how to identify the three problems most businesses encounter and how to overcome them, what it takes to be a highly effective leader, and how to target your ideal customers and turn them into strong promoters of your business.
EDITOR'S PICKS FROM REPORT ON SMALL BUSINESS
Engage first, sell later
An excerpt from Feed The Startup Beast: A 7-Step Guide to Big, Hairy, Outrageous Sales Growth, looks at why companies need to engage first, sell later, adding it should be every business-to-business (B2B) entrepreneur's motto. Why engage? Because buyers tend to be risk averse, and they'll need to get to know you before buying – especially if you're a smaller, less established company. This is what makes them willing to engage.
FROM THE ROSB ARCHIVES
Social media sales success
There are a lot of questions about how small and medium-sized businesses can best make use of social media. Everyone is tweeting or talking about it, many salespeople are asking: "Should I abandon what I'm doing and embrace 'social selling,' or continue along the same path?" The better question, according to this Tibor Shanto column, is this: "How can I leverage both to achieve sales success?"
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Sean Stanleigh