Last week, The SEC adopted final rules to allow reporting companies to rely on the Regulation A exemption from registration for their securities offerings.
Following the news, Crowdfund Insider caught up with Jason Paltrowitz of OTC Markets Group to discuss Reg A+ issued securities trading on OTC markets.
One of the questions Paltrowitz answered was about his expectations for Reg A+ in 2019.
Crowdfund Insider Question: What are your expectations for Reg A+ and 2019? What about small cap issuers in general?
Jason Paltrowitz: “We have seen some very successful uses of Reg A+ … the ones that made the headlines, the exchange-listed offerings, have not fared well, and we would argue that it was very costly for a company that went to an exchange too soon.
However, Reg A has been an effective mechanism for community banks, REITs and other issuers that did not tie the offering to a national exchange listing.
Going forward, it is just another funding arrow in the quiver of small cap issuers. And, in many ways, it is a more effective alternative to PIPES, convertibles and other opaque, less regulated capital raising tools that are the root of the share deposit issues we are talking about.”