Frequently Asked Questions

Under U.S. law, the definition of a “security” is intentionally broad and extends well beyond traditional stock. Equity interests, convertible notes, SAFEs, warrants, profit interests, revenue-sharing arrangements, and certain digital or hybrid instruments are frequently treated as securities under federal and state law.

I help clients analyze offerings under applicable legal tests (including investment contract and note analyses) to determine whether securities laws apply and, if so, how to structure the transaction to align with the company’s financing strategy and growth timeline.

Most startups and small businesses raise capital through exemptions from SEC registration rather than a full public offering. However, exemptions are not automatic and must be carefully selected and strictly followed.

I advise clients on the appropriate exemption - often under Regulation D, Regulation S, or other available frameworks - based on factors such as the type of investors, where the investors reside offering size, marketing plans, relationships between the issuer and the investors, and future capital needs. A properly structured exemption avoids registration while preserving flexibility for later rounds or strategic transactions.

Even exempt offerings typically require post-sale filings at both the federal and state levels. These may include Form D filings with the SEC and “blue sky” notices in the states where investors reside. Filing deadlines, fees, and ongoing obligations vary by jurisdiction.

I manage the full filing process for clients, including identifying where filings are required, preparing accurate disclosures, and addressing late or corrective filings when necessary. Proper filings reduce enforcement risk and prevent problems during investor or acquirer diligence

Investor eligibility depends on the exemption relied upon. Some offerings are limited to “accredited investors,” while others permit a limited number of non-accredited investors who meet sophistication requirements. Certain exemptions impose investment caps or disclosure obligations tied to investor status.

I help clients determine who may invest, how eligibility should be documented, and whether investor verification is required. This ensures compliance while allowing founders to raise capital from appropriate sources without unintentionally violating securities laws.

A common misconception is that securities laws only apply to large or multi-investor offerings. In reality, even a single-investor transaction can be subject to securities regulation if it involves a security.

I regularly advise clients on one-off investments, strategic investors, and insider financings, ensuring that exemptions are properly relied upon and documented. Even simple transactions benefit from careful structuring to avoid compliance issues and future rescission risk.

Yes! This is another common misconception - friends and family offerings are still securities offerings. There is no general exemption simply because investors are personal contacts.

While friends-and-family rounds are common at the early stage, they must still comply with ALL federal and state securities laws, including exemption requirements, disclosure obligations, and filings. I regularly structure these rounds to reduce liability and prevent issues that surface in later VC or M&A diligence.

Maybe! Public statements about fundraising -whether through websites, pitch events, social media, email campaigns, or demo days - can trigger general solicitation concerns and disqualify certain exemptions.

I counsel clients on what can and cannot be said publicly, how to structure investor communications, and how to coordinate marketing efforts with securities compliance. Thoughtful planning allows companies to tell their story while preserving regulatory flexibility.

While a formal PPM is not legally required in every private offering, securities laws always require full and fair disclosure of material information. The scope of disclosure depends on the offering structure, investor profile, and risk tolerance of the company. Even if not legally required it is often by far the best step for the client.

I help clients determine the appropriate disclosure approach - ranging from streamlined offering documents to comprehensive PPMs - balancing legal protection, investor expectations, and cost efficiency. Well-crafted disclosure reduces liability and builds investor confidence.

Many startups raise early capital informally before fully understanding securities requirements. Issues such as missed filings, improper exemptions, unaccredited investors, or incomplete disclosures are common—and often fixable.

I assist clients in evaluating past transactions, identifying risks, and implementing corrective strategies designed to reduce exposure and preserve future financing and exit options. Addressing issues early can prevent minor problems from becoming deal-ending obstacles.

Securities laws can impose personal liability on founders, officers, directors, and other control persons, even in the absence of intentional misconduct. Liability may arise from material misstatements, omissions, or technical compliance failures.

I advise clients on disclosure practices, governance structures, indemnification limitations, and insurance considerations to help manage personal risk while maintaining transparency and regulatory compliance.

Early securities compliance decisions often surface years later during venture capital financings, private equity investments, mergers, or public offerings. Investors and acquirers routinely scrutinize past offerings for compliance gaps.

I structure transactions with long-term objectives in mind, helping clients avoid issues that can delay financings, reduce valuation, or jeopardize an exit. Proper planning today helps preserve flexibility, credibility, and enterprise value in the future.