Capital Raising: 3 Reasons You Should Be Compliant

Capital Raising: 3 Reasons You Should Be Compliant

Many business owners and entrepreneurs are focused on one thing: business. In several cases, business finance law is ignored. The thought of being bogged down with legal is enough to make most entrepreneurs and innovators cringe. Then there is hiring a lawyer with the associated costs and time dedicated to the legal process. For all of this trouble, there has to be a big benefit; and there is.


Keep Your Capital

The process of raising capital for business is a highly demanding task in and of itself. It requires strategy and networking: being in the right place at the right time. While it may succeed, often business owners will face rejection from investors before they succeed in acquiring the necessary funds. For all the work that is required for capital fund acquisition, it can be taken quicker than it was received. This is what happens when companies are sanctioned by the Securities and Exchange Commission for ignoring the legal boundaries and processes necessary for a successful capital raise. While the legal process may be cumbersome, it will ensure that the funds are not revoked for any illegal activity.


Don’t Get Served

A more serious concern for business owners is the possibility of being indicted or even incarcerated. While ignoring securities laws may not seem like severe crimes, the reality is that an individual can face up to five years of incarceration per offense in a federal prison. In many cases, heavy fines are also issued in efforts to reimburse investors for their losses.


Protect Your Rep

As if that’s not reason enough, abiding by business finance laws is important to protect your reputation. Most successful businesses rely on their reputation to generate profitable business and grow their market share. If one is indicted and especially convicted of securities law crimes, their reputation to do business in the future will be greatly tarnished.


If you’re interested in getting on the path to navigate through the regulatory minefield, let Russell Weigel’s book Capital For Keeps be the first step of your guidance. Mr. Weigel is a former SEC attorney and his many years of experience has been condensed in this easy-to-read format that will jumpstart your capital raising in the right direction.







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