SEC Releases Annual Small Business Capital Formation Report for Fiscal Year 2021


On December 9, 2021, the SEC Office of the Advocate for Small Business Capital Formation released its annual report for fiscal year 2021, for the year ending June 30, 2021. The annual report, of interest to any business or fund investment plan to raise capital in 2022, to be found HERE.

Highlights of the annual report findings on the use of the Securities Act public registration exemptions for the fiscal year include:

  • Regulation D, Rule 506 (b) was used for $ 1.9 trillion in raised capital, with a median bid amount of $ 1.8 million, led by the mutual fund industry, followed by the technology, financial services / fintech, real estate and healthcare sectors. The creation of new investment funds of all kinds (venture, private equity, hedge, etc.) has shown a growing domination of family offices and high net worth individuals.
  • Settlement A / A + was used for $ 1.7 billion in capital raised, with a median supply amount of $ 2.3 million, led by the real estate sector, followed by the tech and hardware sectors. financial services / fintech.
  • Settlement D, Rule 506 (c) was used for $ 124 billion in raised capital, with a median bid amount of $ 850,000.
  • Settlement D, Rule 504 was used for $ 313 million in raised capital, with a median bid amount of $ 160,000.
  • The CF (Crowdfunding) settlement was used for $ 174 million in raised capital, with a median bid amount of $ 130,000.

Other exemptions from registration, including Section 4 (a) (2) of the Securities Act, Regulation S and Rule 144A, were used to raise additional capital of $ 1.3 trillion. Additionally, IPOs, including PSPCs, raised $ 317 billion, with a median bid amount of $ 225 million; and other registered bids raised $ 1.4 trillion, with a median bid size of $ 350 million.

The annual report also contains valuable and interesting data on women and minority-owned businesses. Among other things, the data presents striking statistical evidence that investing in women-owned and minority-owned businesses is a wise and smart investment.

These metrics will be explored in more detail, along with discussions of how to structure and when to use each exemption, and their respective attributes, advantages, and disadvantages, in the January 2022 editions of our “Raising Capital Through Private Placements: deal points ”and“ ”SPACs: An IPO and Private Equity Raising Capital Alternative: Deal Points” (current editions of both can be found on Kurtin PLLC Whitepapers and Advisories). Become a tax-advantaged structure and a preferred digital asset capital formation structure, and how to configure and use them. In the meantime, Happy New Year!


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