4 ms·

Thank you so much for providing me with the valued legal info. I am not interested in doing it illegally. But on the other side, if the legal work papers for d

Thank you so much for providing me with the valued legal info. I am not interested in doing it illegally. But on the other side, if the legal work papers for documenting the investment will cost a fortune and has many restrictions, and I won't even be able to do it because I am not in U.S.... Is it possible to treat the shares as virtual product? What about if I work around this and say... yeah these are shares but we will treat it as virtual product, just like the virtual gifts that people buy on facebook and hi5. But you will take advantage of buying this virtual product/gift, that you will be able to resell it to me after a year with higher price, or you can keep it and get devidends... And by buying the virtual product, you own percentage in the startup... What do you think?

dpifke 18y ago
If you sell the shares in the US without complying with securities law, investors can sue you (personally, not the company) to recover their money if it goes south. The fact that the government can order the transaction be unwound at any time will also discourage any investors, since it could potentially eliminate any upside for them. You can call the shares whatever you want, but if the SEC deems them securities, they're securities. For an example of this, Prosper (a P2P-lending site) recently got nailed and is facing huge fines and several lawsuits over what they called "loan notes" and the SEC later said needed to be registered as securities. See: http://fred93blog.blogspot.com/2008/11/prospercom-sec-cease-desist-order.html http://fred93blog.blogspot.com/2008/11/prospercom-sec-cease-... (Please don't take any of what I'm writing as legal advice, you really need to talk to a lawyer. There are ways to go the friends-and-family route that aren't horribly expensive.)
- thepanister 18y ago
  Thank you so much for taking time to help me, I really appreciate it so much. About the SEC, I saw that PayPal started something... they take the money you have in your paypal account, and use it for invesments, and it's NOT covered by SEC. I read that at PayPal. What do you think? EDIT: About lawyers, well... believe me, I have no money! I am not raising the money for the sake of raising money, because I think that raising funds is a "serious responsibility", but I am raising it because I am running out of money, and I am owed!

dpifke 18y ago

If you sell the shares in the US without complying with securities law, investors can sue you (personally, not the company) to recover their money if it goes south. The fact that the government can order the transaction be unwound at any time will also discourage any investors, since it could potentially eliminate any upside for them. You can call the shares whatever you want, but if the SEC deems them securities, they're securities. For an example of this, Prosper (a P2P-lending site) recently got nailed and is facing huge fines and several lawsuits over what they called "loan notes" and the SEC later said needed to be registered as securities. See: http://fred93blog.blogspot.com/2008/11/prospercom-sec-cease-desist-order.html http://fred93blog.blogspot.com/2008/11/prospercom-sec-cease-... (Please don't take any of what I'm writing as legal advice, you really need to talk to a lawyer. There are ways to go the friends-and-family route that aren't horribly expensive.)

thepanister 18y ago
Thank you so much for taking time to help me, I really appreciate it so much. About the SEC, I saw that PayPal started something... they take the money you have in your paypal account, and use it for invesments, and it's NOT covered by SEC. I read that at PayPal. What do you think? EDIT: About lawyers, well... believe me, I have no money! I am not raising the money for the sake of raising money, because I think that raising funds is a "serious responsibility", but I am raising it because I am running out of money, and I am owed!