March 8, 2019 - Reg-CF, aka crowd funding, was implemented by the SEC to afford retail investors the same opportunity as high net worth (accredited) investors, to invest in early stage, private companies, BEFORE they're publicly traded. Giving retail
investors the option of taking greater risk, in return for the possibility of being an early stage investor in the next Google or Facebook, and scoring a monstrous return.
But unlike investing in publicly traded shares, which can quickly be liquidated, investing in private shares requires "patient" capital - because there is no assurance of liquidity anytime in the foreseeable future. So investors in Reg CF offerings should
only invest capital they won't need to return to cash anytime soon.
Many retail investors own substantial "patient" capital. It's called their "retirement" account in the form of IRA / 401k funds. That capital is "patient" by law - because early
withdrawal triggers penalties and taxes. Investing in a "retirement" account is effectively converting "free" cash into "patient" capital. Making it a very attractive source of capital when investing in a Reg-CF offering. In addition, if the
capital is from a ROTH IRA and it is invested properly in a Reg-CF offering, under present law, no future capital gains taxes will be due (anyone considering using ROTH IRA capital to eliminate future capital gains taxes should seek counsel from your tax adviser before investing).
So while IRA "patient" capital is a great match for Reg-CF investing, investing it has been nearly impossible. And in cases where it was possible, it was always complex, difficult and painful for all. The investor, the portal and the IRA custodians. So historically, what should be a substantial source of Reg-CF "patient" capital has been kept "locked away".
As veterans of Reg-CF Offerings, we're acutely aware of this funding "flaw", the inability to make IRA funds readily and easily available. And we've been urging portals to "address" that "flaw" for nearly two years now, when we did our first offering on Wefunder. Well it turns out, Wefunder heard us loud and clear and has been diligently fashioning a mechanism to seamlessly and simply integrate IRA Funding into their portal.
We're very pleased to report that Wefunder has made dramatic progress such that they are ready for a beta tester. And we're honored Wefunder selected us to be that beta tester. That means our offering will be the historic first to utilize Wefunders new tightly integrated IRA Funding mechanism. Implemented to "unlock" investor's "patient" capital and to facilitate its use in Reg-CF Offerings on Wefunder. For
that we applaud.
As beta tester our role is to facilitate a gradual roll out, and to help Wefunder identify and correct any remaining kinks. We are actively seeking a limited number of qualified investors or potential investors who are interested in investing
IRA / 401k capital in our offering. We will work closely with you to insure any kinks are quickly identified and repaired. This is truly a historic moment, one with the potential to leave its mark on Reg-CF investing forever.
To qualify, for the beta test you must first have a self directed IRA / 401K account, an account from which you can transfer funds to an alternative IRA portal - Alto IRA. The IRA portal is the gateway which seamlessly integrates Wefunder with the rest of the IRA universe.
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