The SEC has approved new plans for a revolutionary type of loan facilitated by both crowdfunding and traditional funds. Mark Rockefeller, CEO of StreetShares, of Reston, Virginia, feels the result should benefit small businesses owned by veterans by making financing easier to obtain.
Rockefeller told Small Business Trends, “I wanted to build a company to give veteran business owners and entrepreneurs fast, fair, and transparent funding for their business. And we knew the American public would want to support it. That’s why we began working with the SEC for this unique approval.”
Rockefeller explains that traditionally, crowdfunding has two limitations: being limited to equity investment or accredited investors. Equity investment means you own a piece of the company but can’t get your money back until the company is sold. And the second, he contends, is limited to millionaires, those with the resources to allow the to be accredited.
The StreetShares Community
Street Shares is the first to receive approval from the SEC to allow anybody (non-accredited investors) to back loans and receive interest instead of T-shirts or early products. Anybody can invest. And those interested are encouraged to visit StreetShares.com, join and get notified when investments become available. It costs nothing to post a loan request or run a funding auction. There is no obligation to accept a loan. Street Shares handles the underwriting and credit decisions and co-invests in each loan.
While all small business entrepreneurs are welcome, Rockefeller especially encourages veterans to sign on as either borrowers or investors.
He says, “We focus on this market because we believe veterans make great entrepreneurs and we are veterans ourselves. I returned from Iraq in 2008, and I represent a generation of veterans that left the service to become entrepreneurs in the middle of the financial crisis.” He also finds that loans to vets have fewer defaults.
Street Shares states that most of its loans cost less than a credit card, compared to two popular online small business lenders which have APRs in the range of 40-80 percent.
Rockefeller adds: “Shop around. If you get another loan offer, bring it to us. Let us show you the hidden fees. Let Street Shares beat the offer.”
Image: Street Shares