The 2015 JOBS Act, including Regulation A+, is driving the biotech industry forward. Biotech companies are getting to their IPOs faster, at higher valuations, and using the money to fund further R&D, and hiring to support it.
The push to video conferencing during the pandemic has changed the world of raising capital forever. This CEO raised over $3 billion in their “virtual IPO”, meeting over 1,000 people, including high-profile fund managers, in one-on-ones and groups, via zoom over a 7-day period.
CFO reports that 2020 was a breakout year for Reg A+ offerings. Roughly $3 billion has been raised via Reg A+ since it began in 2015. Though this option hasn’t received the media coverage that SPACs have, we expect that to change this year.
In Reg A+, accredited investors who purchase securities in Reg D or Series A can sell a portion of their holdings, creating a powerful buy incentive given Reg A+’s strong liquidity and the likely step-up in valuation between capital events.
The most common question we get asked is whether it’s really possible for a life sciences company to do a substantial raise of $30M or more via Reg A+, especially if they’re pre-revenue, even pre-clinical. And the answer is yes.
If you’ve been paying any attention to the news, you know that the pandemic has brought about a sea change in the role of retail investors. But here’s the macro story underneath that’s not making the big headlines: investors have cash and are eager to deploy it. According to Bloomberg, there’s $17 trillion burning a hole in pockets.
Selecting the best corporate structure for attracting investors is a very important factor to consider when launching a startup, particularly those in capital-intensive sectors such as biotech, medtech, life sciences, pharma, and similar.
We love seeing companies with life-saving technology get the capital they need to get their technology to patients. But we hate seeing the founders have to give up so much of their hard-earned equity to do so.
As the economy transitions from the Industrial to the Information Age, generally accepted accounting practices (GAAP) have come under fire from analysts and business owners. The issue is the valuation of Intellectual Property (IP) — those non‐physical assets such as trademarks, copyrights, patents, and proprietary databases that have value for their owners.