The Guide to Entrepreneurship

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Chapter 11

Meet the JOBS Act

11.1 Introduction

In an effort to jump-start the entrepreneurial economy, the JOBS

(Jumpstart Our Business Startups) Act created a new provision in

the Securities Act of 1933 Section 4(6) that allows Emerging Growth

Companies (EGCs) to raise up to $1 million in any 12-month period by

selling securities through authorized intermediaries, subject to certain limi-

tations on the matter of the offering and by limiting the amount any per-

son is permitted to invest.

EGCs are a new category of issuer. EGCs are those with (1) less than

$1 billion total annual gross revenues in their most recent scal year, and (2)

have not ...