Document Type



Utah Law Review




Securities “crowdfunding” — the sale of unregistered securities over the internet to large numbers of investors, each of whom contributes only a small amount — is a new concept that comes in at least three types: (1) retail crowdfunding under Title III of the federal JOBS Act of 2012; (2) accredited crowdfunding under Title II of the JOBS Act, which is legally restricted to accredited investors; and (3) intrastate crowdfunding under state law. Which of these three types — all at the dawn of their existence — holds the most promise?

Without claiming to finally resolve the issue, this Article adds the following point: Retail crowdfunding is the most inclusive form of securities crowdfunding, in the sense that everyone is invited regardless of who they are. Inclusivity is core to the nature of crowdfunding as a distinct form of capital raising, and it holds a special value in terms of law, politics and economic prosperity. And retail crowdfunding, compared with the other two types, is clearly the most inclusive.

Accredited crowdfunding is legally limited to “accredited” (wealthy) investors; intrastate crowdfunding is limited to one state’s companies and investors. Retail crowdfunding, by contrast, will be inclusive and open to all Americans, rich and poor, young and old, from coast to coast. This inclusive nature of retail crowdfunding provides an advantage that the other forms necessarily lack.