ADRIAN ? When Gov. Rick Snyder signed a bill Tuesday that authorized local stock exchanges for Michigan securities that will be used in Crowdfunding deals, Michigan took another step towards a totally new way of funding start-ups.
The Michigan Investment Markets legislation introduced by Rep Nancy Jenkins as a compliment to the Michigan Invests Locally Exemption crowdfunding legislation will allow secondary market trading of MILE securities, meaning that equity deals now have a market where shares in Michigan MILE projects can be bought and sold.
MILE lets Michigan businesses solicit investments from Michigan residents and doesn?t require those businesses to pay for expensive audited financials unless they raise more than $1 million per year. Those businesses willing and able to provide audited financials can seek up to $2 million from Michigan residents.
Now there is a secondary market for trading these local stocks that will allow investors to exit deals before the companies are sold, or the money is repaid.
?It?s step two after MILE,? said Christopher Miller, DDA & Economic Development, City of Adrian. ?It makes those equities more marketable.?
Miller has been one of the leaders in promoting crowd funding in Michigan. He said the bill signed by Gov. Snyder this week expands the opportunity for those businesses that make sense under the current MILE legislation. Step three is creating a broker-dealer network to trade these securities, Miller said. This could take another year.
?Michigan is leading the way in crowd funding,? he said. ?Now 13 states have crowd funding laws on the books with 14 more looking at it.?
Mike Brennan is Editor & Publisher of MITechNews.Com. If you have a story idea for MITechNews.Com, email him at [email protected]
