President Obama signed a bill Thursday afternoon that makes crowdfunding the law of the land. The Jumpstart Our Business Startups (JOBS) Act allows, for the first time ever, members of the public to invest in private startup companies using the Internet and social media.
But it could take up to a year before the law actually takes effect as the Securities and Exchange Commission reviews the law and suggests changes in its final implementation.
Still, whenever that happens, one company is already in place to take advantage of the new crowdfunding measures. And no, it’s not Kickstarter, the often-cited example of a crowdfunding website.
The company is called “Rock the Post.” Launched in November 2011 with venture capital funding, Rock the Post markets itself as a social network “for entrepreneurs to fund and swap resources.” The website lists a number of small-scale “successful posts,” so far, most of them charitable and philanthropic endeavors rather than actual business ideas. But up until now, its full worth has yet to be realized.
“Our success has been very limited,” said Tanya Prive, Rock the Post’s co-founder and chief operating officer, in a phone interview with TPM. “We’ve basically been getting the right people in touch with each other, business with investors and intermediaries. But our intention is to be a one-stop shop for startups.”
The centerpiece of Rock the Post’s current architecture is, not surprisingly, the “post.” That’s the online pitch that startups create to try and win over backers for their business ideas, which includes a brief, catchy description and, like Kickstarter, may also contain a video.
But Prive says that the simple website architecture that’s up right now belies a slick system that her small team of six has developed for handling all the legal, business and social media complexities that entrepreneurs will face with launching a startup online, not to mention potential investors.
“We’ll be one of, if not the first, to offer actual investing online,” Prive said.
Prive is just waiting on the SEC to okay the bill to lift the curtain and unveil the new version of “Rock the Post.”
“We are ready to launch as soon as we’re registered [with the SEC] and approved,” Prive said. “In terms of the structure we already have everything built, we’re ready to kick this into high gear.”
The JOBS Act received rare bipartisan support from Congress, easily passing the House and eventually the Senate, after an amendment was added at the last minute to impose some further restrictions, such as forcing startup companies and funding websites to register with and undergo review by the SEC.
But the legislation has received a number of high-profile criticisms by some in the media and a holdout of Democratic lawmakers, who argue that it could result in increased fraud due to the laxer restrictions on who can invest in what companies.
Prive maintained that her platform is secure and that all projects that go up on the website do and will continue to undergo a close vetting process. Prive also said that the legislation, as written, is something that she and others in the crowdfunding business can get behind.
“We’ve tried to stay away from politics and been mostly focused on product,” Prive told TPM. “But this [JOBS Act] is something we support 100 percent.”
As for what impact Rock the Post will have on the startup market, Prive sincerely believes that her website could produce the next great web sensation, though she was careful to point out that not all great startups will be web-based.
“I absolutely think that a company funded on our platform could be the next Facebook,” Prive said. “But ultimately we are just looking for projects that have a good story. We have startups in everything from fashion to tech to software development.”