SEC changes the rules, one group says it will hurt startups
The good news: On September 23rd, startups will be allowed to expand beyond only seeking investor donations privately and can officially begin publicly raising money from accredited investors.
The caveat: a new crop of Securities and Exchange Commission (SEC) fundraising rules may hurt startup companies’ chances of obtaining said investor funding regardless of if a mistake is intentional or not.
Under the new rules, in order for a startup to publicly fundraise, it must do the following:
- Notify the SEC 15 days before they publicly discuss raising money
- File documents with the SEC each time that the company updates their offering materials
- Include a legal boilerplate each time the company talks about their financing publicly
The SEC asserts this is for transparency
The SEC states that it has enacted these rules so that it can properly monitor these transactions and to ensure that companies are being truthful when representing their financials to potential investors – which is understandable. But what has many critics in an uproar is the fact that a startup that happens to slip up one these rules can face up to a one year ban during which they are restricted from fundraising.
Restricting a business from obtaining capital for an entire year is hugely detrimental to profitability and can cause numerous businesses to go under if they don’t have alternative funding sources. The rules may seem easy enough, but having to repeatedly file new documents with the SEC each time that an update is made, and give two weeks advance notice before speaking with an investor isn’t realistic in the business world.
Business owners can’t control when they will come into contact with a certain investor or happen upon an opportunity that requires a quick response, and banning businesses from having a conversation in real-time is extremely restrictive. Although the rules do serve a purpose, they can also hurt the success rate of entrepreneurs looking to expand beyond private fundraising.
SEC is seeking feedback: this is where you come in
The SEC is currently asking for feedback on its proposed rules and several groups have come together to express their concerns and suggest alternatives such as asking the SEC to permit a third party organization like Angel List to take care of any necessary filing on behalf of startups. Although the clock is winding down for feedback, there are still 10 days left to provide comments.
To comment to the SEC either in support or criticism of the new rules, you’ll find instructions here.
Weed greed: Some states are raking in the tax dollars on cannabusinesses
(FINANCE) The tax profits from weed sales in these states just may be enough to push politicians toward legalizing the drug cross-country.
States are making bank on weed taxes
The Marijuana Policy Project makes the case to legalize cannabis with its recently released report. According to the report, as of December 2021, states that legalized adult-use cannabis brought in a combined total of $10.4 billion in tax revenue since 2014. This tracks the 18 states where marijuana is legalized for recreational use. It does not include medical marijuana, which would dramatically increase the figure. The figures also don’t include local tax revenue, just tax revenue at the state level, nor does the report include any licensing or business fees that are generated by the industry.
Which states are bringing in the money with cannabis taxes?
Eighteen states have legalized marijuana for adult use. In some of those states, the laws were just approved, so tax collections have not begun or not yet available. Here are some of the figure’s from the MPP report.
|State||Tax collection in 2021||Total taxes received since cannabis was legalized|
|Colorado||$367+ million (thru November)||$1,791,138,715 (2014)|
|Washington||$480+ million (thru September)||$3,051,390,820 (2014)|
|Oregon||$138+ million (thru September)||$635,512,128 (2016)|
|Alaska||$24+ million (thru October)||$95,004,906 (2016)|
|Nevada||$471+ million (through September)||$471,544,647 (2017)|
|California||$976+ million (through September)||$3,123,477,637 (2018)|
|Massachusetts||$205+ million (through November)||$384,529,750 (Nov. 2018)|
|Michigan||$188+ million (through November)||$271,129,649 (Dec. 2019)|
|Illinois||$387+ million (through November)||$562,750,974 (2020)|
|Maine||$11+ million (through November)||$13,063,204 (Oct. 2020)|
|Arizona||$121+ million (through October)||$121,463,757 (2021)|
Most states have legislation that puts the tax revenue toward specific initiatives. In Illinois, 20% of the revenue goes into mental health services. In Michigan, many of the funds have been put toward schools and transportation. California directs its revenues toward local non-profits that benefit “people adversely impacted by punitive drug laws,” and invests a portion of the money in environmental programs.
Marijuana is profitable
The Hustle reports that Denver generated over $237 million and West Hollywood in California has generated $2.2 million in one year from 6 dispensaries in less than 2 square miles. The Tulsa World reports that Oklahoma, which has only legalized medical marijuana, collected over $55 million in 2019. With more Americans leaning toward decriminalizing marijuana and making it legal, the profits to be made from marijuana sales may push politicians toward legalizing weed.
Get outstanding invoices paid to you by following these 7 steps
(FINANCE) For a freelancer, it’s more important than ever to bring up the issue of getting paid on time. Here are 7 tips to get your money.
For many, an awkward topic of conversation revolves around getting paid. Whether asking for a raise or asking to borrow money, people often feeling uncomfortable when talking money.
This is equally, or possibly even more so, true for freelancers who are solely in charge of their finances. Without a system of weekly direct deposit, freelancers have to work overtime to keep their earnings in order.
The issue with this is that clients also have a lot on their plates, and something as simple as a freelancer’s paycheck is common to fall through the cracks. This causes freelancers to have to work friendly reminders into their repertoire.
However, freelancers may not always be knowledgeable of the best ways to keep their finances in check (no pun intended). Below are seven ways to enhance payment methods.
- You have to be willing to make billing a priority. Due to the fact that money is awkward to talk about, as aforementioned, many let this fall by the wayside. The best way to do this is to keep up to date with your invoices and send them as soon as they are done. Making a calendar specific for billing can help with this idea.
- This second bit dates back to when we were young and learning our manners: it is crucial to be polite. Not only is it the right thing to do, but it also increases speed in payment. Using “please” and “thank you” in invoicing emails are said to get you paid 5% faster.
- It is best to try and keep a complicated concept like finance as simple as possible. Make sure you are creating specific due dates. This will help to signify importance of payment.
- Now that virtually anything can be done online, it would make sense to use electronic payment verses an old-school check. Accepting online payments will get a user paid, on average, eight days faster as opposed to a check.
- This is an important notion to keep in mind for any aspect of your business life: be professional. Invoices are often seen by many eyes so it is best to include your business’s logo on said invoice. This has been found to increase chances of being paid on time by 10%.
- Specificity is urged again in the form of transparency. Make sure you are giving detailed descriptions on each invoice so that anyone looking at it knows exactly what you are being paid for. By doing this, you are 15% more likely to be paid on time.
- While you may be invoicing month by month, try to avoid sending on the 30th or 31st. Being that everyone, generally, sends their invoices in on these dates, it takes 10 – 20% longer to be paid. With everyone sending it at the end of the month, it has a tendency to back up payroll.
The most important thing to remember is that while the topic of money may be awkward, it is your money. If you let a few invoices fall behind because you are uncomfortable reminding your client, this has a way of adding up. Be sure to keep on track with your finances to earn what you are working for.
Why you will pay more to live in larger metros: job opportunities
(BUSINESS NEWS) Small to mid-sized metros offer higher adjusted salaries, but don’t pack your bags just yet because your job may not be there
When I told my parents how much my partner and I would be paying for rent at our new apartment, they quickly pointed out that I could purchase a home for that kind of money in my hometown.
My parents are right, I could literally buy a home for the amount of money I pay in rent every month to live in a large metro area. But the equation that determines where I and many other workers should live, is more complex than salary minus housing.
These areas are cheaper to live in, in part, because they may not offer the kind of job opportunities, and therefore social mobility, you see in larger metro areas. Sure, I could make my money go further in my hometown, but the chances of me finding a job in my industry there are smaller.
Your field of work does matter when considering whether or not the “small-city advantage” could work for you. If you work in tech or finance, two traditionally high-paying fields, then this advantage doesn’t apply.
“Before adjusting for living costs, typical technology salaries are 27% higher in two-million-plus metros than metros with fewer than 250,000 people. Even after adjusting for those costs, tech salaries are still 5% higher in the largest metros than in the smallest ones,” finds Indeed.
If a huge tech company offering thousands of high-paying jobs moved into a smaller city on the map, over time, it would get more expensive to live there. It’s the hamster wheel that is currently driving income inequality in some of America’s largest major metro areas.
Finding the right place to call home is never going to be a single factor decision. Yes, salary is a huge factor, as is the cost of living, but there are also lifestyle factors to consider. What kind of opportunities would you have in this city? How much will it cost to move there? How will this affect the other members of your household?
It’s nice to play the ‘ditch the corporate world and buy a country house’ fantasy after a long day at work, but the reality is far more complex.
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