Oakland, California (EastBayDaily) — Cutting Edge Capital(CEC), a leading firm helping social ventures and entrepreneurs raise capital, announced today that it has listed its Direct Public Offering(DPO) using a new online investing tool that connects local businesses with investors.
The Cutting Edge Capital DPO offers an unsecured note with a four percent annual interest rate over a term of five years, and is being listed on CuttingEdgeX (CEX), an online marketplace that connects everyday investors with independent, social enterprises that need growth capital. CEX, launched in partnership with Hylo, is the only nationwide platform that currently provides a legal way for both accredited and non-accredited investors to discover and participate in DPOs.
CEC’s DPO is also the first to use the new CEX online investment tool, a web-based platform that helps businesses raise capital while streamlining the investing process for individuals who want to put their money to work in companies and social ventures that align with their values.
“The CEX online investment tool is a quantum leap for companies and community investors,” said Jenny Kassan, CEO of Cutting Edge Capital. “For CEC, it allows us to showcase our offering right from our website, and it makes it easy for individuals to invest online.”
To DPO or not to DPO? While they have been available for decades, Direct Public Offerings are less well known than other capital raising options. A DPO allows companies to self-underwrite and self-administer public securities offerings to both accredited and non-accredited investors in one or more states. A company can market and advertise its offering publicly by any means it chooses – through advertising in newspapers and magazines; at public events and private meetings; and on the internet and through social media channels.
DPOs, also known as investment crowdfunding, have helped many companies successfully raise capital from the crowd, including Ben & Jerry’s, Annie’s Homegrown and Real Goods. DPOs also have an investor benefit. Unlike platforms like Kickstarter and Indiegogo, which solicit donations from individuals, who in return get a T-shirt or other perk, DPOs are a public offering of securities with the possibility of a return on investment.
Easy-to-use interface The new online investment tool adds even greater features and benefits in addition to the CuttingEdgeX platform.
The online platform is integrated into the website of the company conducting the DPO with seamless branding and marketing. All relevant information, including the DPO Offering Memorandum, Subscription Agreement, required notices from securities regulators and other important DPO documentation is presented on the website and all offering information can be easily shared on Facebook, Twitter and other social media. The tool also provides the ability for investors to comment on the offering, and a place for the company to post updates.
For investors, the DPO process is broken into four steps that can all be completed online, including: — Filling out an eligibility questionnaire that determines if, and at what amount, an investor can participate in a DPO — Reviewing the DPO Offering Memorandum — Reading and electronically signing a Subscription Agreement — Making the DPO investment online through a credit or debit card
“We are excited to be the first company to issue a DPO using the CEX online investment tool,” said Cutting Edge Capital President John Katovich. “It’s a platform that makes it easy for us to receive investments, helps us track investors and manage communications, and equally important, provides investor-friendly tools for easy participation in the growth and success of our business.”
The Cutting Edge Capital DPO is available only to California residents and the minimum investment is $1,000.
About Cutting Edge Capital Cutting Edge Capital provides small and mid-sized businesses with the information, tools, and expertise they need to raise capital in a way that fits with their unique business model and long-term goals. The firm has completed ten DPOs for clients that raised nearly $5 million, and has another 20+ DPOs in the pipeline. As experienced business lawyers, entrepreneurs, and finance experts, the CEC team has identified capital raising strategies that allow businesses to solicit non-traditional sources of funding. In addition to being a great way to raise capital, these strategies allow businesses to build public support and recognition at the same time they are raising funds. For more information, please visit http://www.cuttingedgecapital.com.
About CuttingEdgeX CuttingEdgeX (CEX) is a direct public offering marketplace that connects everyday investors with independent, social enterprises that need growth capital. Several businesses and organizations, including Arroyo Food Co-op, Calvert Foundation, Farm Fresh to You, People’s Community Market and RSF Social Finance have listed their DPOs on CEX.
About Hylo Hylo (in private Beta) is a new kind of social network that helps connect people, projects, intentions, and resources, in community.