Crowdfunding to Fund Acquisition?

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September 13, 2021

by a searcher from The Johns Hopkins University in New York, NY, USA

Has anyone considered crowdfunding to fund an acquisition? Companies can raise up to $5 million. Getting audited financials for this would be relatively simple with a newly incorporated company - only other hurdle would be digital marketing spend, but I expect many people on SMB twitter could source from their followers.

Pros: passive investors, give away much less equity (valuations on crowdfunds are incredible) Cons: initial outlay of capital to fund digital marketing

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commentor profile
Reply by a searcher
in Tampa, FL, USA
Wanted to share this post on the topic.

https://www.searchfunder.com/post/raising-capital-using-investment-crowdfunding


Commitments
Time: 4-15 months
Cost: $6k - 12k and 8% of raise

Please feel free to reach out directly to John (contact info below) or I am happy to facilitate a warm introduction as well.

John Panaccione
redacted www.follacapital.com
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Reply by a searcher
from Harvard University in Boston, MA, USA
RegCF could be challenging - see 4.d on this page https://www.sec.gov/info/smallbus/secg/rccomplianceguide###-###-#### htm "companies that have no specific business plan or have indicated their business plan is to engage in a merger or acquisition with an unidentified company or companies [are not eligible to use Regulation Crowdfunding]"

I don't believe RegA+ has the same prohibition, but RegA+ costs a few hundred thousand to kickoff
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