Colorado Crowdfunding Act

Problem

Entrepreneurs today are developing ideas at a pace and in a way that traditional funding sources can’t or don’t want to fund. Many times, these companies are simply restaurant ideas, or local food markets, or even technology companies that need less than a million dollars to make their idea commercial and successful. These new business ventures require a different form of funding. 

Solution

This year, Representative Dan Pabon passed legislation, “The Colorado Crowdfunding Act,” to open up the potential pool of investors that startups can approach for funding. The bill allows any Colorado resident to invest up to $5,000 in a company without the need for accreditation. While companies must inform investors of the risk and provide quarterly reports, they can skip the audit and other expenses typically needed to attract investors. The bill will help new entrepreneurs raise the initial funding they need to launch and develop their businesses and help grow the local economy.