

Required steps for investments? Can private investments be simply automated? - TimothyBurgess

Suppose I want to set up an area on my startup's homepage for pretty much anyone to invest in my company - whether it's $5 or $5,000,000 - and in return they of course get a percentage of the company proportional to their investment.  The process should be automated.  How would I go about this?<p>I've done a bit of research on the matter but I must not be using the right keywords because I haven't found what I'm looking for.  If there are already services out there like this, I'm not aware of them and would love to hear what you all have to say about them.
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michael_dorfman
_Suppose I want to set up an area..._

Well, to start with, you'd likely be in violation of a whole mess o' SEC
regulations. I'm not a lawyer, but you certainly should be speaking to one
before you go any further in your research. (The fact that you didn't mention
the phrase "accredited investor" is a tip-off.)

That being said: I don't agree that "the process should be automated." It
seems to me that the process would be infrequent enough, and specific enough
each time, that any attempt at automation would have an absurdly low ROI.

In other words: there's a couple good reasons why you haven't found what you
are looking for, and they have nothing to do with finding the right keywords.

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TimothyBurgess
Is stock exchange not automated for the most part? People can buy and sell
their stocks with pretty much just the click of a button. That's essentially
what I'm looking for.

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michael_dorfman
Yes, the stock market is automated-- and highly regulated.

Of course, the stock market is limited to publicly traded stocks, and there
are all kinds of regulations applying to the actions of the companies traded.

If you are really interested in this area, you might want to start here:

[http://en.wikipedia.org/wiki/Securities_regulation_in_the_Un...](http://en.wikipedia.org/wiki/Securities_regulation_in_the_United_States)

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TimothyBurgess
What if I just add a place for visitors to donate and in return for donations
I offer an arbitrarily small percentage of the company that just so happens to
be proportional to the donation amount? Those who donate will just have to
take my word for it. :P

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michael_dorfman
That's exactly the kind of thing the Securities Act of 1933 is trying to
prevent.

Seriously, talk to a lawyer. Or, at the very least, start reading up on
Securities Regulations on Wikipedia.

